All Forum Posts by: Donald Robers

1932 - THE OLD DARK HOUSE                                                                                                                                   A little bright paint, some updated light fixtures...

1959 - HOUSE ON HAUNTED HILL                                                                                                                             Location, location, location!

1972 - LAST HOUSE ON THE LEFT                                                                                                                             Well if it's the last house, we had better get it under contract.

1979 - THE AMITYVILLE HORROR                                                                                                                             If during your due diligence you discover an axe murder in the basement...

1980 - THE SHINING                                                                                                                                               Caretakers - amirite?

1980 - MOTEL HELL                                                                                                                                                 Just a little rebranding and we'll leave that Bates Motel joint in the dust!                         

1982 - POLTERGEIST                                                                                                                                               Note to developers : a sacred burial ground is not the perfect substrate for a residence.

1984 - A NIGHTMARE ON ELM STREET                                                                                                                       Let's say a "challenging property" on Elm Street.  Stay positive!

1987 - FLOWERS IN THE ATTIC                                                                                                                                 Cold be worse.  Could be mold.  Or racoons.

1991 - THE PEOPLE UNDER THE STAIRS                                                                                                                     There is such a thing as carrying house hacking way too far!

Sorry I did not make myself clear. If you have a "buyer's agent" it just means that you are paying that agent's portion of the sales commission.  Usually the seller of the house pays all of the commission from his or her proceeds from the sale.  Lets say that the house sells for $100,000 and the seller has agreed to pay 6% commission on the sale.  

If the original (listing) agent finds a buyer with no other agent involved then that agent is paid $6000 by the seller.  If a second agent finds the buyer then the seller pays each agent $3000. 

If, however, you have an agent helping you to find a house and you agree to pay that agent's part of the commission then you have a buyer's agent who should watch out for your interests.

And just to note - I am using a simple example for clarity.  There are all different commission rates and splitting methods.   The exact rates and splitting percentages vary with local practice and by the type of property

Hi @Albert Chun - First, you should realize that unless you have a buyer's agent, that you are paying a commission on the sale, any agents involved in the sale are working for the seller.  Granted, professional ethics should not allow them to actively deceive you but be prepared to verify any information you are given, either by your own research or by a financially disinterested third party.

That said, you should ask about any known physical problems : aging roof, damp basement, due-for-replacement HVAC system.  I believe that most states have a disclosure form that an agent is supposed to fill out with the owner.  Obviously, the value of this disclosure is in direct ratio to the honesty of the owner.  But it is a start.

Next you should move on to the financial aspects of the transaction. You should ask about the amounts of the previous years property taxes and average utility bills. Verify that there are no special assessments known to the seller. Ask about any HOA involvement, and if so request a copy of the bylaws and a full schedule of fees.

If the answers to those questions are satisfactory and your own interest in the property has survived a visual inspection, spend a little time checking out the neighborhood.  You can fix a lot of things, but you cannot fix a lousy neighbor.

If the house is still a candidate make an offer with sufficient earnest money to have it taken seriously.  Use inspection contingencies to make sure that the seller and agents have been reasonably forthcoming as to the condition of the property.

I am currently in escrow to sell a property via VA loan. The VA recently modified their requirements to include a pest inspection on all VA funded purchases (previously it was state specific). This gives you a good reason to invoke a financing clause. Glad to hear that the selling party saw reason.

The VA also requires the seller to pay for the pest inspection. Make sure the seller's agent does not slip that cost onto your side of the ledger at closing!

@Alexander Gutierrez

I may be mistaken but from the wording of your post I take it that you are trying to sell a vacant lot - i.e. no structure existing but buildable?

If so, would that have any effect on the utility of hiring an agent rather than continuing with the FSBO route? For example, I would assume a longer time on the market than a traditional land + structure offering. I also wonder if, MLS access aside, an agent could substantially decrease the days on market or increase the sale price enough to justify the commission.

But I may be completely wrong in my reasoning

The seller accepted your offer.  Unless there is language in the Offer To Purchase that empowers the seller to back out if he discovers he underpriced his property (and why would you sign such an offer?) you could sue for specific performance.  And it may not come to that.  The seller may do the right thing and honor the contract.

For your part, since this is a matter upon which your financing depends, the option is there to back out of the deal as long as you have a financing contingency.  You can get your earnest money returned and the seller would have to disclose the water issues to future buyers.  You might mention this should the seller prove difficult.

Definitely express your displeasure to the bank - after you get your money.

@Mark Miles

As a customer of vacation STRs I would suggest that you put all of your funds and effort into improving upon the performance of the previous hosts rather than ride on their reputation.  By upping the level of communication, amenities and follow through for your guests you will earn your own rating, and do it in a manner that gives you long term benefit instead of a mere initial bump.

For insight into the psychology behind customer reviews I suggest you read some of the Uber/Lyft driver forums.  The consensus opinion seems to be:

1.  Customers (i.e. riders) are uncomfortable giving a binary (very bad or very good) rating unless there have been extraordinary events.  They tend to "split the difference with a rating of 2 or 4.

2.  Customers are unaware of the importance of feedback to you as a business proprietor and so dash off a hurried, superficial response to post-stay reviews.

@Nandy B. - No matter how this deal works out you learned a lot about REI, and you did it without losing a bunch of money. You showed great initiative and good sense by running this past the people on this site with more experience. Those traits will be of huge value going forward with any career.

And kudos to all of the knowledgeable posters who rapidly divined the truth behind this transaction.

Negotiate to the point that both parties feel they are getting what they need from the agreement.  Then sign the contract.