Don’t pop the champagne until the deal is really sealed… this is from an article I read early last year when trawling through the facts and figures of house fall through figures during 2015. It is such a bold but yet accurate statement, which all agents should and need to identify with.
We all know that having an offer doesn’t necessarily mean that you have sold the property – it is merely a stronger declaration of interest. Neither the vendor nor the agent should ever assume that there is a guaranteed sale on the horizon until the sale is completed.
Even after an offer has been made and accepted by your client, there are an array of things that can go wrong or cause the buyer to change his or her mind.
For example their mortgage may fall through, they could get a bad valuation done on their property or even have a sale of their own fall through.
So how do you cover all those bases and aim for a home run in the sales department? Here are our top 5 reasons we believe most home sales fall apart…
- Buyer financing
- Low Valuations
- Home inspections and scary surprises
- Buyer remorse
- Hinging your sale on the buyers sale
- In an ideal world we would all love a cash buyer with no chain, however we all know that this isn’t always the case. Having a greater understanding of the buyers financial position throughout the process is key – always make regular checks on the approvals process to ensure that the mortgage is well underway and isn’t likely to hit any speed bumps during this vital stage.
- An appraisal lower than the contract price can cause a deal to fall through. A buyer’s lender will only lend up to the value of the property, so if the home value appraises lower than the agreed amount, the buyer cannot secure the full mortgage. If buyers can’t pony up the difference from their savings, a lower-than-expected appraisal can be a deal breaker. In these cases, you must be ready to negotiate and be willing to lower the price if they want to close immediately.
- Many home sales fail to make it to closing if the buyer’s inspection reveals serious physical faults with the property. If at all possible, sellers should be aware in advance, always ensure that you are ready to tackle any problematic issues before you reach this stage. Always make the vendor aware of any significant flaws in their home that would jeopardize a closing.
- The entire home purchase process is a very stressful one. You should always be aware and look out for signs of ‘Buyers Remorse’. They’re investing a substantial amount of money in what they hope is their forever home. They have to live with the house and the community every day. Sometimes buyers just get cold feet. Unfortunately, there is little agents can do to eliminate buyer’s remorse, but you can be on guard for buyers who seem especially anxious or indecisive about negotiating a deal. When you have the option – which isn’t often the case, favour your more enthusiastic, confident buyers.
- Many buyers need the equity in their current home to purchase a new one; therefore if your buyer’s home sale falls through, your home sale could fall through too. However, avoiding this pitfall is easy: Don’t allow the sale of a buyer’s home as a contract contingency. Instead, target buyers who have already sold their home, or who aren’t relying on the equity in their current home to help finance the sale.
If you would like to find out more about how BoomerangCRM can help you increase referrals, market share and overall growth then contact a member of the team by email on firstname.lastname@example.org or by phone on 0844 273 2944