"As far as the listing agent saying to "keep in touch," what does that even mean, if the sellers don't sell before their contract expires and then take the house off the market?"

It depends on the state and the listing agreement between the seller and agent...........but in MY area the agent has procuring cause... if the listing agreement expires and the seller does not relist the property with another agent and you approach the seller to buy the house that listing agent is entitled to a commission and can take action to get paid.

My read on your overall post is the listing agent understands this is a difficult decision/position for you (you aren't the ideal buyer for her sellers but they could make it work ) and you should keep her infomed of your interest in the property and/or decision to sell your home.

My lender instincts are roused by the story of your finding this cool house.

Please be cautious. If you decide to make an offer include a financing contingency as another safety valve.

Don't know your finances; but, it might be that a lender will not qualify you for financing on the new house unless you first sell your current house. IMO, that's a good thing. But, if the lender qualifies you to carry both mortgages...that's where caution is really needed. Can you REALLY afford to carry two mortgages? If so, for how long? If it takes a year to sell your current house...will continuing to pay the mortgage destroy your short-term savings? Will it stretch your disposable income to the breaking point & potentially cause friction in your marriage? You get the gist.

I believe in taking advantage of opportunity when it knocks but I don't believe in betting the farm on it.

Wishing you fair winds & safe harbor.

/tricia

As long as you have a financing contingency, you don't have to worry about "paying too much", even if the market falls by the time you are ready to close on the purchase.

This is because the lender will require the appraisal to come back at the purchase price or better.

To be extra safe, you can add the appraisal contingency to the contract - stating the purchase is contingent on the property appraising at least at the agreed upon price..with appraisal to occur within 30 days of closing.(with a mortgage, this would be the case anyway, roughly within this timeframe).This additionakl appraisal contigency might scare the seller, though. You might be better just using the built-in appraisal contigency that is tied in with the mortgage.

Oops,

Re-read your post & it looks like you covered with the sale of your existing home contingency. That would take care of the financing issue. I'd still recommend the financing contingency though...suspenders & belt approach.

/t

having done this, and failed to sell our home bcs the market in my area was stalling (not just dropping, stalling), I would say this:

Run the numbers at a LOW sale price for your home.

Once there is a contract in the mix, you need a fast sale of your own home, which means you want to price low enough to make someone bid now. What would that number be, an dcan you swing the new home w/ that sale as your equity?

If so, then go ahead, and price your home for a quick sale.

My house is for sale right now and there is no way on this earth I would accept a contingency to take my house off the market to give you time to sell yours. In most states, the house with the contingency on it must be listed as under contract (don't know the exact term), which would significantly reduce showings for the seller even with a kick out clause. In this tough market, we're just not willing to take that chance, especially since your house is not ready to list.

Things the seller will consider is what if your house doesn't sell? What if you change your mind and back out after they've limited their possibilities of selling the home to someone else?

Personally, get your house ready to sell, get a realtor and list it. If that house is still available, then it was meant to be.

When my MIL was selling her home in NJ, she got a contingent offer on the buyer selling their house. Before she rejected that, I suggested she get her realtor to pull the comps for their home and to tour it to see how sellable it was. Realtor did that and MIL drove by the home and it was one of tonnes of houses for sale in the neighbourhood and her realtor felt it was overpriced.

MIL countered back no selling contingency and they didn't respond. She wound up selling her house to the first couple who looked at it. The deal on their condo fell through and so they didn't put in an offer. When they sold their condo, they came back and bought the house.

In this tough market, unless the seller has all the time in the world, few will accept the selling contingency.

My husband and I made the offer on our current house in late April two weeks before we put our old house on the market. The offer was $8k below their asking price ($14k below their original price), plus the contingency of selling our house first before completing the deal. We had the usual inspection contingencies as well. We'd been pre-approved by our bank, so were not worried about the financing contingency. Plus, we put down $1k in earnest money, which for our region is considered a lot. Our offer was accepted with no counter other than we sell our old house in one month vs. the two months we proposed. When our house didn't sell after one month (no surprise there), the sellers granted us an extension of another month. Just when we thought we'd have to ask for another extension, we decided to go ahead with a bridge loan. We had the bridge loan for a week when we got a good offer on our old house (closed in July). We ended up paying about $1500 in interest for the bridge loan, and while some would call that a waste of money, moving at the time we did saved our sanity! For us, it was money well spent. There is more than one right house for everyone--I do believe that. But the house we bought fits our needs so perfectly it was as if it'd been built just for us. I can't imagine a better house.

In response to sparksals post: Our sellers did include a 72-hour clause in the contract. That meant if they got a better offer--one without a sale contingency--we'd have 72 hours to remove all our contingencies and proceed with the purchase or they could accept the second offer. The listing for the house said "72-hour clause" on it. It was not listed as being under contract, nor was it listed as sale pending. I know the sellers' agent held several open houses between the time our offer was accepted and the time we closed.

I think the sellers were more accepting of the sale contingency since they'd already bought another property and moved. The house had been on the market since January when we made the offer on it in late April.

In this market, you got to be flexible if you want to sell your house.

Sparksals...good luck getting your house sold.

In our region, we found the standard is your house has to be listed for a seller to consider your contingency offer serious. If you are serious on the offer, I'd say get your house listed ASAP before you submit it. Of course, practices in your area might be different and that's where a realtor might be able to help too.

I also agree with one of the other posters above that if you want to sell, you have to be flexible. Again, such a sale contingency is standard in the DC/MD/VA region unless you are selling a starter home. The listings say "KO" kick-out or "No KO" no kick out. That said, I'll have to admit, we really weren't interested in looking at any "KO" houses though as we still had our own to sell.

I did not think our sellers would accept a contingency (even with the kick-out clause) but they did. We've since removed it and plan to move next week, but my agent made it clear to me that he does NOT want to accept any contingencies when it comes to selling my house. Good enough on the buying side, but not as a seller. ;-)

We originally thought the kick-out clause was a lovely idea when we were first on the market, but we got screwed over pretty hard by it - in our town the buyers' agents simply didn't show houses with KOs, since there was enough inventory that was less-complicated. (And to be honest we skipped over the KOs when looking as well, since we didn't want to find a house we really liked and get into negotiations to find that the original offer-ers had pulled off their sale and removed their contingency. We could either get booted or in a bidding war, at the whim of the seller.) We lost weeks of the prime early-summer selling season; went from showings virtually every day, sometimes more than one a day, to less than one a week while we were under a KO contract, and never quite recovered. That buyer's house STILL has not sold after 4+ months, too, so we'd've still been sitting around with our thumbs up our... ahem... either hoping for that elusive viable competing offer or a buyer for the buyer. Your market may differ, but given our previous experience with the KO clause, there's no way we would risk accepting another one, and we wouldn't do it to a seller.

a seller who accepts a contingent contract needs to have a deadline: if the buyer's home isn't under signed contract in X time, the seller can bail.

It depends on the market. In our area the MLS shows houses with kick out clauses as current but under kick out clause YES.

I love to show houses with a kick out clause but only to the right buyer and under the right circumstances.

If my buyer has a house to sell- I always tell them to get the seller to remove the clause you'll have to make an exceptional offer. I still call the agent and ask them to let us know if something happens. Sometimes the agent will say- get your buyers in- its about to fall apart and we are the first ones in because the other agents are avoiding it.

If they do not have a house to sell or can buy without selling- I say get right in and let's talk money. A vacant house with a kickout clause is often a good buy if the buyer can close quickly.

But you are right many agents discourage buyers (mostly because they think it will be a pain in the butt and usually it is).

terrig - In this market, you got to be flexible if you want to sell your house.

Sparksals...good luck getting your house sold.

I don't view it as inflexibility at all. THis is a tough market. Every state, city, town varies. In AZ, the house is listed as Active Cappa meaning there is a contract. I don't know if it says it has a KO clause or not. However, when I told our realtor we would not entertain any selling contingencies, they agreed because many realtors don't show houses that have KO's on them, especially when inventory right now is so high.

It's not inflexibility at all. It's doing what is best for us. We cannot take our house off the market in the hopes another person's house will sell. It would severely limit or stop showings on our home.

Johnmari stated it perfectly. Too many things can go wrong where the seller accepting the contingency gets screwed big time. I wouldn't do it to a seller either. In this market, I think it's actually quite rude to expect someone to take their house off the market in the hopes you will sell your house. (general you)

I just don't understand why people go shopping for a new home when their home hasn't sold, let alone is not even remotely ready to put on the market. In a sellers market, maybe, but not in these market conditions.

"she said given the market today, yes, the sellers might be open to a contingency offer. I also asked her if she was free to tell me how long were they planning to keep it on, and she said they did not want to show through the holidays."

Interesting information. If the agent is correct, these sellers probably plan to suspend showings as the holidays approach. So, as the holidays approach, these sellers might as well accept a contingent contract. They don't have to show their home, but, as you show yours, they still have a chance of moving forward. What do they have to lose by giving you a shot for a couple months?

From a previous thread, it sounds like this may be a special fit for your family. So if I were you, I'd get your home ready to sell and also look at some more homes in the new area, just to make sure this is "the one." If you still want it, make the contingent offer in a month when your home is ready. Bid what you think the home is worth; in this setting (buyers market and holidays) I'm not sure your offer has to be on the high side to be considered.

We made a low ball offer contingent on our pending sale closing, no kick out. House had been on the market less than a month and sellers planned to rent for a year if it sold quickly. After a couple counters over price, they accepted, contingency and all! In Phx, it's listed as active with contingencies. I'm sure the showings are dead!

As sellers, we wouldn't take any contingencies.

So it really depends. I don't think it really hurts to make an offer now as long as you have the contingencies in place to protect you. Negociate the price you think it's worth, not what you think they'll accept. If you can't come to an agreement WITH the contingencies, proceed with selling your house and then approach the sellers again once you get an offer on your own house. They may feel differently about the market, the price, and buyers with a pending sale in a few months in this bad market.

quip, Your post reflects exactly what we've been thinking. If the sellers don't get another offer in the next few weeks and they don't want to show over the holidays, what do they have to lose by giving us a shot with our contingency offer in a month or so (after our house is listed), while they're not showing the home anyway?

I have a listing agent coming by early next week and am setting up more appointments. My market is very slow right now, too, but we think we'll give this a shot. If we can make the numbers work with a low sale price for our home and buy the other house, maybe we'll have a happy ending for all parties involved. If the other house goes to another buyer before we could grab it, then at least we'll come away with something, like maybe an offer for our house and money to shop for a different home, or, we get no offers, know to stay put awhile, and we try again when the market's hopefully better.

Good luck to everyone here and thank you for the advice.

I think this depends on how you feel about the house. Personally, I wouldn't do it since it means that you have to bid high on the house (because of the contingency) and will rush to get your house on the market - plus you may not get top dollar for yours since you need to sell quickly.

But if you are attached to the house already, then logic plays a secondary role. ;)

"It's not inflexibility at all. It's doing what is best for us. We cannot take our house off the market in the hopes another person's house will sell. It would severely limit or stop showings on our home."

That's your choice. Our sellers chose to accept our offer...that was their choice. Ours was the only offer they had on the table and, like I said, they'd already bought a brand new condo and needed a buyer for their house. Whether accepting our sale contingency stopped or slowed their showings, I do not know. We do know that they know we were prepared to go ahead with the bridge loan if need be. I think that gave them the assurance they needed that we were serious about buying their house.

"Johnmari stated it perfectly. Too many things can go wrong where the seller accepting the contingency gets screwed big time. I wouldn't do it to a seller either. In this market, I think it's actually quite rude to expect someone to take their house off the market in the hopes you will sell your house. (general you)"

If you're going to be concerned about hurting people's feelings, you should probably not make any business deals. Buying/selling a house is business. So we were rude. Huh. The sellers willingly accepted our "rudeness." They could have walked away.

"I just don't understand why people go shopping for a new home when their home hasn't sold, let alone is not even remotely ready to put on the market. In a sellers market, maybe, but not in these market conditions."

Our old house went on the market two weeks after we made the offer on the new house. We live in a small town. We didn't have a huge inventory of available houses that met our needs. We have two teenagers who live with us on the weekends...we wanted a lower level area that they could call their own since during the week they are literally crammed into a 500 SF apartment and share a very small bedroom. We had just started looking to see what was available for what we could afford when we found our new house. It could not have been more perfect had it been built just for us! The layout was right (the boys got their lower level...they share a 750 SF area which includes separate bedrooms), the location was right, and the price was right. Sometimes--often actually--life doesn't happen in the order you want it to. Sure, we would have preferred to sell our old house first (which was quite small for four people) and then made an offer on a new house. But things didn't work out that way. Sorry if this bothers you, Sparksal, but my husband and I have sold two houses and bought a third all in six months this year, so we have experience with this tough market. We did what worked for us. You do what works for you and I sincerely wish you the best of luck.

We went over our situation with the listing agent again: We said we have to get our own house ready for sale (we told her we'd need about a month), and asked if the owners would consider a contingency offer. She said a few years ago no one would have, but she said given the market today, yes, the sellers might be open to a contingency offer. I also asked her if she was free to tell me how long were they planning to keep it on, and she said they did not want to show through the holidays. This house listed in early August, so I'm guessing they may have signed a three-month contract. The agent also said we could think about "keeping in touch."

Good for you! You knew what questions you wanted to ask and did; plus you got honest answers! It sounds like a good situation for both of you.

I don't agree that you need to bid high. You also need to have your own agent as I don't know if the sellers agent can help you come to a number. You of course would want lower comps to get a better price while the seller will want higher comps, if either can be found.

"I just don't understand why people go shopping for a new home when their home hasn't sold, let alone is not even remotely ready to put on the market. In a sellers market, maybe, but not in these market conditions."

Raising hand... No secret that I've been out there looking since February. I looked online until late April / early May then stopped going out when the market stopped. I was still looking online though and did not see anything worth going out for until late July. Hubby & decided after the last outing that for the price we were shopping we should have found something in the chosen area(s) but it wasn't meant to be. We decided to look at new and after pounding the pavement found "the one", now we have to sell.

I'm actually surprised you aren't looking in your new area. Do you have any clue what's out there? I doubt you want to rent, hopefully you won't have to.

Everyone has their own reason for looking before putting their house for sale or looking before selling. I can say there is a lot of inventory in very inflated markets here. If any house will do, then you don't need to cover your bases, but if you have special needs like we did, it gets harder to find.

My house is for sale right now and there is no way on this earth I would accept a contingency to take my house off the market to give you time to sell yours. In most states, the house with the contingency on it must be listed as under contract (don't know the exact term), which would significantly reduce showings for the seller even with a kick out clause. In this tough market, we're just not willing to take that chance, especially since your house is not ready to list.

Not sure what the norm is here or what we would do. I know I would not take it off of the market but may consider it if I can still show the house and there was some kind of kick out clause where they would either remove the contingency...

Thanks again to everyone for the honest input.

Latest update: heard from the listing agent, who said the owners have an offer for under list without a contingency. She said the owners liked us and to please let her know our thoughts. Where I'd last left things with the agent was we needed to get our house on the market, and we're meeting with listing agents this week. She also said she's having an open house today if we want to take another look.

After reading some of the posts in this thread, we have a better sense of all the downsides of contingencies not just for a seller but as a buyer, and we're leaning against making a contingency offer for several reasons. If the sellers have another offer it puzzles me as to why they wouldn't take it (over one from us, with a contigency, I mean), unless it's extremely low. Thoughts?

Even when I get a good offer from a buyer I always call other intersted buyers to let them know especially if they have asked me to do so.

If you make an offer now she can go back to buyer one and say- we're getting another offer, we have another offer, you are in a multiple offer situation. Some buyers have the need to win and may put all their cards on the table with the thought of "losing" their house.

OR

It is a really difficult/low offer and she doesn't have faith that it will come together/ get her client what they want and she is hoping you'll throw your hat in the ring...

Remember the listing agent works for the seller- her fiduciary duty is to them- she must do everything she can to get them the best $$, situation, etc. If you represent that- she is going to pursue you until you buy the house or tell her to stop.

OK, got it. I'll call her today and tell her we're out.

We have to get our house on the market. We'll contact her after that point to see if the house is going on the market again, if it's been sold, or what. We've decided a contingency offer isn't for us, though. We'd rather buy with money in hand.

Latest update: heard from the listing agent, who said the owners have an offer for under list without a contingency. She said the owners liked us and to please let her know our thoughts. Where I'd last left things with the agent was we needed to get our house on the market, and we're meeting with listing agents this week. She also said she's having an open house today if we want to take another look.

If there is an offer at all, it is probably way low. The reason I think she may be bluffing or that the offer is disgustingly low is it seems like there was no time limit that they had to get back to the buyers. Usually when an offer comes in, there is a certain amount of time to reply. She's also going ahead with the open house, which to me sounds like they don't want to accept the low offer and are hoping to generate interest at the open. By the time you meet her, another buyer may materialize.

With them keeping in contact with you, they know you are interested and are trying to get you to budge. You really need to get an agent to deal with this or it might get to be too much.

I'd also imagine the contract is expiring soon. Of course the agent wants to sell the house, the sellers may not list with her when they decide to put it back on

In this market, I think it's actually quite rude to expect someone to take their house off the market in the hopes you will sell your house. (general you)

Is it rude to offer less money, as well? Because nobody is forcing the seller to accept such a contingency. If they do, that was their choice; asking is nothing more than seeking information (will they?) and a point of negotiation (just like price, closing date/costs, etc.).

I just don't understand why people go shopping for a new home when their home hasn't sold, let alone is not even remotely ready to put on the market. In a sellers market, maybe, but not in these market conditions.

You could not have convinced me I would consider moving anytime soon, yet I woke up one morning wanting something closer in RIGHTNOW. And the right house happened to be in the right place at the right price and vacant just when I had this overwhelming, heretofore unconsidered urge to move. Had that not happened we would have done things in a better order, for sure!

terrig - That's your choice. Our sellers chose to accept our offer...that was their choice. Ours was the only offer they had on the table and, like I said, they'd already bought a brand new condo and needed a buyer for their house. Whether accepting our sale contingency stopped or slowed their showings, I do not know. We do know that they know we were prepared to go ahead with the bridge loan if need be. I think that gave them the assurance they needed that we were serious about buying their house.

I don't think it's a choice, but a form of necessity for some people not to take a seller's contingency. We are not prepared to take a bridge loan. You may be able to afford one, but many people can't. We prefer to live within our means and not over-extend ourselves. And as I stated before, selling contingency significant reduces, if not halts showings. With so much to choose from, a realtor will skip over a home that has a KO most of the time - especially in this market.

If you're going to be concerned about hurting people's feelings, you should probably not make any business deals. Buying/selling a house is business. So we were rude. Huh. The sellers willingly accepted our "rudeness." They could have walked away.

I did not call you rude. I said that in this market, I consider it rude for a buyer to expect a seller to remove their home from the market so they can sell their house. I am perfectly capable of making business deals.

Sorry if this bothers you, Sparksal, but my husband and I have sold two houses and bought a third all in six months this year, so we have experience with this tough market. We did what worked for us. You do what works for you and I sincerely wish you the best of luck.

It doesn't bother me per se. It's a personal opinion.
So, you've sold a few homes. What works for you doesn't necessarily work in other markets, so your excellent and superior experience in selling homes in this tough market has no bearing on the experience of others.

Your posts are becoming extremely condescending again and perhaps you may want to re-think the tone of what you write.

Rose -
I'm actually surprised you aren't looking in your new area. Do you have any clue what's out there? I doubt you want to rent, hopefully you won't have to.

My bad, Rose, as it was a poor choice of words on my part. I meant shopping for a home and putting in an offer without having your (general you) home ready to list. In the huge seller's market, it could work, but in today's market, that is a huge risk for a seller to take. If the buyer's home is on the market and has a contract with contingencies removed, I may consider it, but one that isn't listed or even ready to put on the market?? Not on your life (or mine!). lol

I have been looking in the Minneapolis area since we knew that is where we would be moving. I check the MLS, have listings emailed, watch price drops, research communities, etc. However, I will not buy a home, let alone put in an offer until the contingencies are removed from our home (aka home inspection finished, financing approved etc.).

Not sure what the norm is here or what we would do. I know I would not take it off of the market but may consider it if I can still show the house and there was some kind of kick out clause where they would either remove the contingency or step aside.

I think with most selling contingencies, the seller can show the house. The problem is in this tough market, a realtor most likely will bypass a home with a KO because there is so many more homes to choose from to show the buyer. Why would they take a chance on the buyer loving a house that may not be available when there are thousands of others?