Agent won't show occupied unit for sale?

Question

Hey all! I'm looking to buy my first property - a duplex. The back has been renovated and has pictures posted but there are no pictures of the front unit which has not been renovated due to it being occupied.

I'm set to go see the property tomorrow but the agent just informed me that we cannot see the front unit because it's occupied.. Is this normal?

His response as to when we could see the front unit was, "Only showing after under contract" Seems crazy to me to even consider buying a property without being able to see it.

Thoughts? Advice? Is this normal?

Josh Dillingham · Answer

@Sarah Metzger this is not common in my market, but based on @Russell Brazil expert opinion it can vary.  What does your agent have to say about it? As long as you have an inspection contingency it should be fine.  It could actually benefit you as not being able to see the unit prior to being under contract may scare off other potential buyers.  I love the quote that @David Greene had on this weeks podcast "real estate investing is about solving problems"  this may be a problem you are willing to solve that may scare other buyers off.

Aly Vizcarra · Answer

Not uncommon for my area.  We have some tenant occupied units were the renters are very cooperative and let us show the property with a reasonable notice.  If the tenants like where they live it´s in their best interest to start off on good terms with the new owner.

Other tenants that aren´t as cooperative understand that when the property is finally sold, either their rent is about to be increased or they have to move. So they aren´t very motivated to show their unit.

Your agent will recommend writing the offer subject to inspection of the front unit.  Meaning if you don´t like what you see... you get your deposit back.

Best of luck.

Michaela G. · Answer

The big picture is: There are a lot of tire kickers, who waste a lot of agent's time with showings, but who make very few offers. And it'd be very annoying to a tenant to have a constant stream of lookie-loos going in and out of there home.

So, set yourself apart from those tire kickers. Find a way to prove that you're serious. Pre-approval letter of proof of cash in the bank. Offer with high earnest money, subject to you inspecting the other unit.

Something to show the seller, that you're serious and aren't just wasting their time.

Jennifer Soelberg · Answer

@Sarah Metzger

That is uncommon in my market as well. The realtor we work with makes sure we were able to look at the inside of properties even with tenants. But, as mentioned before it could vary depending on the market. I agree with @Josh Dillingham to just make sure you have the inspection contingency in place. Good luck on your first property!

Russell Brazil · Answer

Pretty common in my market to not see occupied units until the home inspection.

Steve Bracero · Answer

@Sarah Metzger

Its common here to only show occupied units once under contract.

Wesley W. · Answer

@Sarah MetzgerNOT common in my market.

There are pros and cons.  PROS: gives you a chance to retrade on original price if the condition was not accurately represented on the listing (it seldom is in my experience).  CONS:  You'll already have skin in the game (legal fees, inspection, time) to the tune of several hundred dollars, and if you find some issues and try and retrade with the seller (who, unlike you, has not spent a dime or any of his time) can tell you to go and pound sand.  This has actually happened to me on more than one deal.  I didn't succumb to sunk-cost biases and I personally walked away.  Henceforth, I will not make an offer unless I can see all the units first.

Good luck!

Jason Powell · Answer

This is normal in my market. I personally wouldn't show all the units to anyone who "was interested in making an offer". Granted, the listing agent/owner should be able to paint a very clear picture of what you can expect to see as far as the condition of the unit so there aren't any surprises that kill the deal after the contract is signed.

Peter MacKercher · Answer

@Sarah Metzger That's common in my market as well. It partly depends on the manager/listing agent, what the laws around notice are, and if the tenants are bothered about it. It's not in the managers or current owner's interest to continually disturb tenants for every showing as the deal could fall through and the property may go off market, leaving you to interact with tenants who are now annoyed. Initial showings are only the first of many inspections, after all.

Sarah Metzger · Answer

Thanks @Josh Dillingham I'm starting to think the same thing - I'm sure it'll scare others considering it's almost scared me off