Many (Or Most?) Home Sellers Prioritize Certainty Over Price
Scott P. Rogers
When a seller signs a contract with a buyer, they want to be as certain as possible that the contract will proceed to settlement.
The king of all offers, providing the most certainty to a seller would be a cash offer with no contingencies whatsoever.
As each of the contingencies below are added to a contract, the seller's certainty decreases...
- financing contingency
- appraisal contingency
- home inspection
- radon test
- septic inspection
- home sale contingency
It is important, as a buyer, to remember that most sellers are thinking about certainty alongside price.
Which of these offers is likely to succeed?
- Offer of $300,000 with only a financing contingency.
- Offer of $301,000 with a financing contingency and a home inspection contingency.
- Offer of $305,000 with a financing contingency, home inspection contingency, radon test contingency, septic inspection contingency and an appraisal contingency.
When presented with these three offers I think many or most sellers would choose offer #1 even though it is $1K or $5K lower than the other two offers in hand.
Give careful thought to the contingencies you do and do not include in your offer and understand how they affect the seller's view of the certainty that your contract will make it to settlement.
