I’m going to share an anecdote here that I believe illustrates precisely what a broker should and shouldn’t do when working with a buyer and/or seller of residential real estate.
First the players:
Broker: Yours truly
Buyers: My best friends (let’s call them Biff and Buffy to protect their anonymity)
Sellers: The same aforementioned Biff and Buffy as they are attempting the very challenging yet possible simultaneous purchase and sale.
Biff and Buffy are best friends of mine (our children are best friends too) and approached me about 6 weeks ago to determine whether they should move to a more desirable apartment. Their current home is beautiful but they were looking for something a bit larger with some extraordinary qualities like stunning views, outdoor space, or an extra bedroom (we got the views and the outdoor space).
Now typically, I refer friends and family to a member of my team in an effort to both preserve my relationship with them as well as keeping their financial situation confidential. I have found that many friends and family aren’t keen on full disclosure of their finances during the transaction process. That said, I decided that i would handle the sale of their property (no financial disclosure needed there) and another member of my team would assist them with the purchase. Not a bad idea in theory but (FIRST MISTAKE) I found myself unable to detach from the buy side transaction as they are such dear friends.
Collectively we decided that Biff and Buffy should look at a few properties to determine if indeed there was anything out there that would urge them to leave their already beautiful home. Of course they fell in love with something their first week looking (SECOND MISTAKE-not managing expectations if this should happen). At that moment, we needed to strategize on how to best sell their current home so that they could possibly proceed with the purchase of their new love which they viewed on a Sunday. (DID IT RIGHT) On that Thursday, we put their home on the market of course with professional photos, floor plan and a global marketing plan that insured that the broadest population of buyers saw the home. We received 6 offers after only 3 days on the market and one open house.
So despite the fact that we had 6 offers and accepted one of many bids over the asking price, (DID IT RIGHT)I still wasn’t comfortable having my friends bid on the other property without a signed contract on theirs. Well the stars were aligned and we received a signed contract back for their place that Friday and submitted a bid for the new home the following Monday. Everything happened so quickly that (ANOTHER MISTAKE…oh my, sloppy) communication throughout this expeditious process broke down on my side. My intentions were always good but I really needed to communicate better precisely what was happening with both transactions as they were happening. I was so set on making sure that my friends got what they wanted and I made assumptions about what they already knew about buying and selling a home.
After a tedious and stressful negotiation in which I was very much involved (DID IT RIGHT)over the contract for their purchase, terms were agreed upon, and a contract was signed.
This morning I received an email from Buffy asking me about transfer taxes on their sale. Holy cow!!!! I forgot to inform them about all of their closing costs (MY FINAL MISTAKE…at least in this transaction I hope!)
So as you can see, my desire to do everything in my power to make sure that my friends got what they wanted resulted in some sloppy brokering on my part. That said, they are now happily in contract on both the sale of their home as well as the purchase of a gorgeous and grand 2BR condo with a massive terrace and views!
The moral of the story: Don’t ASSUME (you know what they say about that!) that your clients whether buyers or sellers are familiar with any aspect of the transaction. Always:
- Manage expectations throughout the process (my clients weren’t familiar with 10% contract deposit due at contract signing)
- Let your clients know the buying and selling process and what is happening every step of the way
- Discuss closing costs giving a estimate of what they will be.
- Ask your clients continuously if they have any questions about the process.
- And if you’re every sloppy like this, learn from your mistakes…I know I have!!!
So in the end we GOT IT RIGHT and everyone is very happy despite a communication breakdown!