Agreed. I had an offer on a property in southern California. Contract and all. After the physical inspections there was some problems and the owner was very slow on getting me requested information.
Because the seller and his agent were not forth coming I told my agent that because of the defincencies send the letter with drawing the offer.
I was looking to buy and do a 1031 exchange. When I made the offer I quit looking at other properties. So when the deal fell through I had no back up and was coming against the time limit. so in a short time I had to find a property make an offer and be in escrow or I would have had to pay about $120,000 in capitol gains.
On what grounds? If you didn’t have a good reason, you could be sued for breach of contract. “I just didn’t want it anymore” or “I changed my mind” doesn’t hold up much in court.
There were many problems that came up during the inspections. Basically about $200,000 worth of repairs. One of the units had its electrical meter removed by SDGE.
They were required to send me the operating cost and rents collected for the last 12 months. And when my agent call asking about any of the problems they would “call back”.
They did not meet their obligations so I was able to cancel the contract because contingencies were not being meet. After waiting 3 days to get answers from the sellers agent the next morning after canceling the contract at 8:00 AM my agent got a call from their agent. He wanted to know what he could do to save the sale. The only way I would reconsider all repairs completed, restore power and unit in good standing with SDGE.
A contract is only an agreement. Nothing more. It may be enforceable, maybe not, depending on the resources of the parties. If your prospective buyer turns out to have terrible credit, your contract ain’t gonna do jack. If you don’t keep showing the house, you are put into the terrible position of having no back-up plan. In that case, I, with my terrible credit rating, could keep badgering you into making idiotic concessions just to sell the house.
The agent is looking for a performance of the contract; in the chance that the contracted terms are not performed by the prospective buyer, the agent is open to contingency offers. If it is a licensed agent, he is probably doing the correct thing.
I used to be a Realtor ™, and every dick and his brother would waste our time by making idiotic ‘Creative Financing’ offers, which would only serve to give them free housing at the homeowners expense until they would have ended up being evicted. Having contingency offers could eliminate much of this.
It’s quite normal, and even expected in many cases that the property will continue to be shown while under contract until the contract contingencies are satisfied and removed and the contact goes hard.
If I was a seller I would definitely want my Broker to continue showing the property in that scenario.
A couple of people have mentioned lawsuits for breach of contract. IANAL, but I’m sure this is theoretically possible. Practically though, it is unlikely.
As I mentioned, if you are the seller and sue, the house cannot be sold until the suit is over and the buyer is forced to perform on the contract. If you are selling because of a new job or the like, and have to move anyway, you have an empty house to pay for until the suit is settled. Which will take a while.
If you are a buyer and sue, you will have to complete the purchase if you win. Assuming you are buying to move into the area for some reason, you will need temporary quarters until the suit is settled Probably not worth it. Plus, I would hate to move into a house possessed by someone who now hates me.
I’m sure this happens for extremely expensive houses, but I doubt it is a credible threat. Plus, as has been mentioned, there are many ways to not perform.
That’s exactly how it is here. I’ve sold two houses, and twice I’ve had offers to purchase fall through (for basically reasons like, “We changed our minds - sorry!”). We just gave the deposit back and went on to the next purchasers. Our real estate agent said we could sue, but we’d get nowhere in court and it would be a big, expensive hassle, so just sell it to someone else and leave it alone.
It kind of sucks for sellers here; as the seller, you are expected to honour the offer to purchase, but the buyers aren’t. Oh well - what can you do? You just roll with it and move on (which is a lot easier to say than do, after you got all excited because your house had a good offer on it and you thought it was sold).