Selling 2 Homes to Buy as a Couple
A couple called yesterday to inquire about a pending sale I have listed in West Sacramento and whether they could see it. They plan on selling 2 homes in Sacramento to buy one as a couple. I’m not sure where they found the listing online but not every website out there lists the status of homes online. Many just show the home for sale and they don’t tell the website visitor whether the home has sold or is pending, which is why it’s oh-so-much better to get your listings directly from a Sacramento REALTOR who can sign you up for automatic emails from our mothership: MLS.
But if you’re just starting your hunt to buy a Sacramento home, you don’t think of that. You think, oh, look, here is a website of homes for sale, and there you go. You just want to get an idea of what’s for sale. Sure, you bought a home before, like this couple who called, because they each own a home. He owns a cottage among the leafy streets of homes in East Sacramento. Her home is in Sacramento. They have decided that West Sacramento is a good place to look for a home because a buyer gets so much more for the money.
That’s true. A comparable home in East Sacramento would cost at least $100,000 more than similar sized homes in West Sacramento, and most likely double. This couple had not yet talked to a mortgage broker, but they knew they wanted to sell at least one home. We discussed making a contingent offer on a home to buy. That was enlightening, because they weren’t sure how to go about selling 2 homes in Sacramento to buy one.
The thing is a mortgage broker will need to qualify this couple to own 3 homes. To make 3 mortgage payments. You can’t say you will rent out one of the homes because there is no rental record if they are not now rentals. Most lenders today want to see at least 6 months to a year or more of rental receipts. There are bridge loan options available but they are expensive. It would be much better to get preapproved, put one home off market in MLS until they find a home to buy and then write the offer subject to selling the home, which then immediately goes live. That’s the best option that safeguards this couple if they follow through with selling 2 homes to buy one.
Well, the number one option is sell both homes and use the cash proceeds to buy a home without a contingency in West Sacramento, but that’s not a) convenient for most people or b) really necessary. We can write contingent offers and get those offers accepted. We do it all the time.
The problem is waiting for that oh-so-perfect beautiful home that 3 other buyers want, and you have no preapproval letter and no homes on the market. If you’re in that situation, call Elizabeth Weintraub at 916.233.6759. We’ve been helping people in this situation for decades.
The Amazing Story of a Sacramento Real Estate Miracle
No Sacramento Realtor expects her client to call, late on Sunday no less, just as The Oscars are starting, to excitedly announce he has written an offer on her listing with another agent. Yet, stranger things have happened in Sacramento real estate. Things that can make clients believe this is the way they always occur, and anybody can do it. When my client first uttered those words last night, I thought he was joking. We closed escrow in 2013, but I recall his transaction like it was yesterday, even though I’ve sold hundreds of homes since but few are a Sacramento real estate miracle.
This guy was originally a referral to me by another agent. He claimed to have overpaid for a home he owned in north Sacramento, which he needed to sell, and yes, it wasn’t worth what he owed. He also wanted to buy a home in Elk Grove during a super-heated real estate market. Selling and buying concurrently is a delicate balance, but even more so in a hot market. That scenario typically requires careful planning, including contingent offers. I took him on as a client as a favor to the referring agent, and because he needed a miracle. Fortunately, I can perform miracles.
I sold his home in north Sacramento for a lot more than it would likely appraise at to a cash buyer from San Francisco. That buyer’s agent did not know the neighborhood. Negotiated a 6-month rent back at less-than-market rent for him, so my client did not have to move. At the same time, I helped him buy my short sale listing in Elk Grove through my team member. The sellers received a number of offers for this short sale but they decided to take my team member’s offer for this client because they believed, even though it was contingent upon selling his home, that I would sell it. They had faith in my abilities. Some other agent, maybe not, but I perform. I can do a Sacramento real estate miracle.
Ordinarily, you cannot submit a contingent offer for a short sale to the bank because the bank will say come back when the home is sold. But I calculated by the time the bank raised that particular objection, I would have sold his home. And that’s what happened. Basically, this was a guy who was underwater, and I moved him from north Sacramento into a four-bedroom, two-story home in Elk Grove. All the stars aligned. It was a Sacramento real estate miracle.
You can imagine my shock when this guy said he had written an offer through another agent on one of my listings. The agent is his buddy, a long-term friend, says he, the guy who had initially sold him the home in north Sacramento. Then he apologized, said he was sorry. Well, that makes two of us. Of course, I immediately realized that he did not write an offer for any of my listings. I’m not sure which home he is trying to buy, but it’s not one of my listings, and he confused me with some other top Sacramento agent. Not only that, I checked MLS and his home was not on the market, it is not for sale, so he is not buying anything. Sellers generally do not accept offers from contingent buyers if that buyer’s home is not for sale.
I don’t see a Sacramento real estate miracle happening here.
I am very successful with selling and buying a home at the same time, in part because other listing agents in Sacramento know I will perform as well. They know my reputation. If you need to both sell a home and buy a home, call Elizabeth Weintraub at 916.233.6759.
A Blessing in Disguise is Rarely a Mistake
Except when I am predisposed, like at a movie theater or on a plane, I answer my phone. It’s rarely a mistake. I missed a call yesterday from a caller who rang twice while I was at Tower Theatre watching Brooklyn, the screenplay by Nick Hornby, about an Irish girl in 1952 (the year I was born) who moved to America. Touching, beautiful, sweet story about loss, love, discovery and strength, watching this young girl mature, blossom, develop confidence. When I got back to my home office, I considered calling back the no-message caller but instead decided to cut back the hydrangeas before it got dark and cover up the cactus garden. We were in for a freeze in Land Park.
Minutes after opening the back door my phone began to ring. Where did I leave it? I frantically searched, dashing from the kitchen into the family room, following the ringing sound and there it was, lying in the cat condo of all places along with my bluetooth. Hmmm. It was the same guy who had called twice earlier. He was very excited about the house he had just toured and expressed gratitude that I had forced him to go see the home without me.
What? Who was this? I let him talk. He obviously had called me by mistake because I had not talked with him earlier. I did not tell him to go see a home, and that’s not the sort of thing I would do anyway. I would never send a buyer over to a home without an agent present, that’s just poor customer service and laziness. He continued rambling that he wanted to sell his home in Fair Oaks. Sure, we can do that, I promised. I’m a top producer in Sacramento who gets top dollar. What’s the address? He gave it to me.
That’s when he said that he wanted me to also represent him to buy the home on Alex along with listing his own home because “it would make things easier.” No, not really, I countered. It’s just as much work to sell your home as it is to help you to buy a new home. Just because you’re the same person doesn’t mean it’s not twice the work. I knew where he was going with this, and just let him blab. He stumbled and seemed at a loss for words. “Well, it’s easier for ME,” he finally says. Why? Because you can call the same agent, is that it? Thinking to myself: he’s already called a different agent thrice and has no clue that I am not that agent. Yeah, yeah, that’s it, he says.
Then he rattled on about the price of the home on Alex. “You said there was some flexibility in that sales price,” he insisted. Well, no, I would not have ever said a thing like that. Because that would violate the Code of Ethics, and a listing agent can’t say such a thing to a potential buyer. This is when the caller probably started to realize that maybe he wasn’t talking to the listing agent. He said, it doesn’t matter because the listing agent is friends with the seller. Some friend to the seller that is, I ventured.
That’s when he hung up.
Making a Contingent Offer When Your Home is Not Yet on the Market
If you don’t eat yer meat, you can’t have any pudding. It’s not just Pink Floyd who says, among other disturbing insights, there is a certain order to the world if you want to get things done. If one can’t abide by customary procedures, then there could be ways around it, which is often my specialty as a Sacramento Realtor. To operate within the confines and restraints of a system with the goal of discovering a loophole designed to bestow an advantage for clients, while minimizing risk. And a contingent offer certainly falls within those parameters.
Part of that success means I need to know the residential purchase agreement inside and out and all of the accompanying documents. You won’t find me at a loss for words when a client needs advice. It might be complicated, but I’ll give it to them straight.
I wonder what other agents tell their clients? When I receive a contingent offer from a buyer’s agent in a pre-acknowledged multiple-offer situation without any preface, just: here it is, it makes me wonder. First I check to see if the agent showed the home. Nope, not that I can determine. That would mean the buyer probably came through a Sunday open house and then called his agent after being informed all offers would be considered immediately thereafter. Yet, why would a buyer submit a contingent offer when the buyer’s present home was not only not in escrow but not even on the market?
Having posed that question, let me add that I am sometimes lucky enough to get a contingent offer accepted for a home not on the market when we’re working with buyers, but we don’t just dump the offer on the listing agent without an explanation. We also produce an MLS number for the contingent property and explain our extensive marketing system. We give the other listing agent a solid plan to pass on to her seller. Then it’s no skin off the seller’s teeth to accept our offer because that listing can remain in active release clause.
Giving a listing agent a contingent offer subject to selling a home when said home is not even on the market is like Wimpy: I’ll gladly pay you Tuesday for a hamburger today. It’s like saying: if I could afford to buy your home, I most certainly would, Ollie, and flipping your tie around. Such a thing can make you feel like you’re Bojack Horseman, trying to explain to Princess Carolyn that her date is really 3 little boys stacked on top of each other under a trench coat.
Elk Grove Sellers Who Buy With a Contingent Offer is Becoming the Norm
We just closed escrow yesterday for an evening news anchor and his family. They were able to sell an existing home, rent back for a while and close on another home, and we helped them every step of the way. Further, it was a contingent offer that scored the family the home of their dreams. Now, I know there are potential sellers who don’t believe it is possible to get an offer accepted to buy a home when their own home is not yet sold, but that is a common procedure for experienced Elk Grove agents. The trick is to make sure your home is on the market before you try to buy a home. Make it contingent.
I talk to scores of people all day long who call to ask about buying a home when they also have a home to sell. Each is different, and there is no cookie-cutter solution. I have many scenarios to choose from that will work, it just depends which is best for the client. But I do know, beyond a shadow of a doubt, if a seller needs to sell in order to buy, I’m your Sacramento REALTOR who will get the job done.
In this particular instance, I had sold this Elk Grove seller’s home 3 times. Three times! Flakey buyers. Buyers who get all the way to escrow closing, two days away and then suddenly realize, oh my gosh, we can’t get our money out of China! If I had a dime for every time I heard that excuse I still couldn’t afford an oceanfront home in Maui. Or, they are trying to sell a home but won’t price it in accordance with the comparable sales so we have to cancel them because we want to be in escrow with buyers who will actually close. We lost our first two buyers for reason #1 and reason #2.
But our third buyer stuck. Our third buyer was in a multiple-offer situation with another buyer, too. This was a home with no upgrades, no granite counters, no stainless appliances, no crown molding, nothing really special except the view. We worked out all of the details before the offer was formally presented to the sellers, the amount of the rent back, the duration, which made the entire process that much more pleasant for all parties concerned.
The home the sellers found to buy was also their third escrow. The first two homes, well, after presentation of all the facts, the sellers found some terms?that were unacceptable, and we helped them to cancel. It is not up to us to try to talk anybody out of canceling. If the home is not for them, it’s not for them, next. We want happy sellers and buyers.
Sure, sometimes it seems like we do 3 times the work to get the same results we used to obtain years ago without all of that work, but that’s how the business is these days. We do what we have to do to keep our clients smiling. It doesn’t have to be a pain in the neck to sell a home and buy another at the same time. Not if you’re dealing with pros. I say, bring on the contingent offers, boys, this is where we shine!