Siblings are amazed by how region’s prices can alter the homebuying process
Jan 05, 2023By Pat Kapowich | Published: February 26, 2022 | For the Bay Area News Group and its flagships The Mercury News and East Bay Times
Q: Regarding your column on The Mercury News and East Bay Times websites on Feb.12, 2022, “Accepting a preemptive purchase offer is not the most fruitful negotiating gambit”: Late last year, my siblings and I received an inheritance from our grandparents. The condition is that we use the money as down payments to purchase homes. Last month, my brother bought a small house in Sacramento. The sellers provided their disclosures within days of the ratified purchase offer. My brother was allowed a seven-day contingency period to hire inspectors. He had contingencies of 10 days to secure a bank appraisal and 12 days for his final loan approval. If there are surprises, his deposit is refundable during the contingency periods. If I recall correctly, that is a traditional-style home sale.
Last week, our sister bought a Southern California bungalow with a preemptive offer. The purchase happened so fast that the sellers had not completed disclosures. The sale lacked contingencies. The inspections were not ordered or performed. The buyer’s agent who represented my sister told me, “Home sellers in our area do not provide upfront inspections or disclosures.” The transaction was astonishingly reckless.
I’m trying to buy a Bay Area property. My buyer’s agent insists offers must be free of contingencies and hundreds of thousands of dollars over list price. My Silicon Valley buyer’s agent gleefully boasted that Bay Area seller inspections and disclosures are available upfront to eliminate my reluctance. Why do expensive areas in California have reckless homebuying practices and less expensive regions do not?
A: Veteran real estate agents and attorneys know that the lower price ranges produce higher-stakes transactions. It is where agents representing first-time homebuyers and sellers square off for every dollar and move in a chess game; sometimes the skilled against the unskilled, occasionally the ethical versus the unethical. Transactions with a complete set of contingencies help limit false moves and reduce post-sale litigation.
Conversely, agents representing people of means or experienced homebuyers and sellers who favor the expensive price ranges play a form of preseason ice hockey — charging ahead, delivering body checks and taking the gloves off. I saw Rodney Dangerfield perform his truism live, “I went to a fight the other night, and a hockey game broke out.” I’ve also seen preseason so-called professional hockey players locked in fistfights while the skated referees circled, lying in wait. In markets with noncontingent, over-list price offers, it is the real estate attorney circling, receiving one beat-up litigant after another.
Questions? Or are you or someone you know navigating life’s transitions? Let lauded negotiator Pat Kapowich make your next move easy. Visit Kapowich’s website for free area housing data, insights and trends. Or put his artful blend of specialized credentials, decades of experience and endorsed skill set to work for you. Kapowich instills confidence when buying, selling, relocating or resizing homes. Do not just make a move — make the best move. Contact him today, Realtor Pat Kapowich, a career-long consumer-protection advocate.
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