Seasoned real estate agents, where would you have dropped this?

[Russell Holmes]

As a new Realtor, I had a nice and challenging first offer fall through.  I feel I learned a lot, and know some things to look out for, but I'm curious if you pros would have pursued as far as I did or would have clued into the shady nature sooner.

I'm working with an investor buyer who found me through BP.  We are looking for the elusive flip house in my area, the classic 3/2 block house with high enough comps surrounding to support the 25-30% target profit.  We are also exploring cheap 2/1s with added master suites and other similar options.  We've analyzed a few that look to have thin margins, walked one overpriced one that needed far too much work.  I verbally offered on that but the listing agent was honest about the sellers ability to hold long term before discount.  

I finally found my client a hidden gem: A 1150sqft 3/2 block home listed for $79k in an area with nearly identical $155-165k comps. Horrible single picture, hardly any description, classic! It was tenant occupied, drive by requested, showing after offer and proof of funds. No problem. Wrote up an offer and proof of funds, and tried contacting the listing agent. After a week of calling his cell, office phone, speaking with the office assistant, and emailing him, I finally reached the listing agent. I let him know we had an offer coming and confirmed his email. Submitted the offer Friday with an expiration of Tuesday. By midday Tuesday I figured I'd check in on this offer. Reached out by phone, text, email, office multiple times and couldn't reach the dude. Offer expired and no MLS listed contact info lead to the agent. Offer was over 90% of list, so even a full price counter would have been reasonable. The next morning, Wednesday, I contacted the broker (Lesson learned, I'll do this sooner next time). He replied right back to me and got the listing agent in the loop. L.A. replied with a canned response, thanking me for my interest and instructing offers to be emailed to a DIFFERENT EMAIL?!?!?! Broker responded that I had offered the previous week, I did the same, heard nothing. Later that day, listing withdrawn unconditionally along with 4 other properties by the same seller...... who withdraws a listing when somebody is blowing up your phone trying to offer to buy?

I then looked up phone numbers and addresses for the seller.  Found some non working numbers and eventually left an offer and proof of funds in the locked gate of the seller's local rural property via tax records Friday of the same week.  Seller called me Monday morning and kept me on the phone nearly an hour (should have hung up sooner!), talking up all five properties and offering $2500/property commission that I asked for on the one, accepting my offer, and offering $20k total if I sell all 5 for him as a buyers agent, he had a RE attorney and title company already.  I said I'd see what I could do, and further inquired about the subject property I offered on.  He then stated that he had a pending out of state offer on all five properties, but it was supposed to close that friday and didn't look promising.  If I had a buyer, he wouldn't extend that offer past expiration and they hadn't even inspected or schedule closing.

Great, I get with my client and we prepare a new offer with all cash, quick close, new dates, etc. Line up his contractor and inspector for Monday pending word of the other offer falling through. With this prepared, I reach out to the seller to let him know we had a new offer coming over and as soon as he could sign our offer, we'd pull the trigger on inspections and under 11 day closing from that Monday. He already knew that my client wanted to see the property and his funds were in an IRA with a 48 hour wire transfer delay. Mentioning the GC and inspector coming monday, seller flipped his game at that point. He claimed the 'pending offer' was now looking like it would go through and he'd let me know if not. He needed something to close that week, so Monday was too late (His 'pending offer' had til the friday before, how could he expect to close with another buyer during that period?). He then strangely texted later saying that he couldn't wait on inspections and needed a 24 hour closing all cash, as 10 days cash with an inspection wasn't good enough. Yet this place has been listed off and on since last November... he said if I had any "other" buyers who could close quicker to let him know. I politely let him know that a buyer with funds available in a self directed IRA is about as close to cash as he can demand since it has been listed so long.

So obviously, long story short, this seller is a bit of a nut job.  I don't know if he was trying to hustle a wholesale type deal on his own place, whether he's hiding some major flaw, or just a flaky guy, but obviously this deal wasn't going to go through.  Would the pros who have been hunting investment deals for clients gone this far, or were there red flags that I should have seen as deal breakers?  I know a 1 in 10 on offers accepting is normal, but it was weird for my quest to even submit the offer to have been such an adventure.  I'm on the hunt for the next one, but want to be sure I learn as much as possible from this crazy situation, haha.  I didn't close a deal, but it was fun hunting!   If it were my money on the line, I would have pursued this property just as hard with how good the numbers looked, but if there was a definite "not going to happen" moment I missed, I'd love to catch it next time.