All Forum Posts by: TJ Joseph

An acquaintance has a house that is currently listed - the listing agreement terminates at the end of April. He has not been successful selling the house because they overpriced it. He paid substantially more than the price at which he listed it - having purchased it at the peak of the market. He has reduced the price quite a bit since then and is now nearing a level where it is still overpriced but somewhat realistic.

We are in the market for a house and he suggested that we make a private deal after the listing arrangement ends. If he does this, he will not have to pay a commission and it would be possible for him to lower the price to a level that is doable for me and still financially viable for him.

My questions:

Would this arrangement result in exposure for him with the listing agent?

Could it result in any financial exposure for me?

Can I structure the deal in a way that we have a contractual obligation that would prevent him from selling the house - since it means we would not be looking for a house if we are going to buy his house - and still not create financial exposure for either of us with the listing agent?

We have not retained an agent at this time so we don't have any contractual obligation with any agent. We are currently leasing a home until the end of June and would like to close on a house before our lease ends. If we are going to purchase this guy's house then we'd like to find some way that we can both be legally obligated because I would not want to stop looking and then a month down the line find that he has sold the house to someone else because he got a better offer.

I assume entering into a private contract before the listing agreement ends would create exposure for the seller.

Julia, thanks for the feedback. This is all a learning experience for me.

At the listed price, it would really not make any sense for anyone to buy the house given the needed work to get it into a livable condition. So I have no idea as to the rationale that Homepath used to arrive at the price the house is listed. FWIW, there was another house in a nearby sub-division that we did see but decided against which ended up selling at a discount of 12% from the original list price. They did lower the price once after the initial listing. This house that sold was in better condition overall than the one we are considering bidding on.

I did read on another thread that in some parts of the country, Homepath does refurbish a house to make it livable but in other areas they do not invest any funds. I assume that any offer I make should not be conditioned on an allowance for the needed repairs based on a home inspection after a contract is ratified.

Thanks for the response.

Am I best off placing an offer through the listing agent or does it not make a difference since a licensed agent can do so online anyway?

Is Homepath more inclined to sell to an owner/occupier during the "first look" period and to that extent would they be more inclined to accept an offer that is about 85% of the list price? The house came on the market during the past few days. I am not sure why Homepath listed it as high as they did given the comps for similar houses during the past six months.

I am new to buying property on Homepath but not new to buying real estate. 

We moved to Tampa a few months ago and have identified a house being offered by Homepath that seems suitable for our needs although it does need to have fair amount of work done such as new carpets, new flooring because the laminate floor is in bad shape, etc.

The list price on the house - which recently came on the market - is a shade lower than what such a house should sell for if it did not need some of the work that I outlined. In other words the comps support the list price if the house was in move in condition. 

We were thinking of making an offer at about 15% below the list price - it is in its "first look" period. Is this the best approach as opposed to offering more and then looking to get some sort of allowance for all of the needed work after a home inspection?

Also, what are some of the other issues that I need to do diligence: would a clear title be something that would be routinely done before the close? What about any arrears on taxes, HOA, etc - would these be paid by the seller or is it something that I have to be concerned about? Are there other issues that I should be aware of that are relevant when it comes to buying a Homepath property?

Finally, although we were thinking of taking a mortgage, we are in a position to pay cash if that would improve our chances of getting our offer accepted. Does a cash offer make a difference?

Sorry for all the basic questions but unfortunately my agent is not informed about the intricacies of buying a Homepath property and this forum seems to have a lot of informed people who have been through the process.

Thanks in advance for any help you can offer.