When you have agents on both sides who don’t recognize red flags, you can end up with deals that get done, only to fall apart before closing. On our MLS system, such transactions are called DFT, or Deal Fell Through.
Whenever a deal falls through, there is short window of opportunity for a buyer to come in with a firm offer to get the property at a great price. Here’s some examples of when that happened.
Photo from RE/MAX REALTRON ROBERT KROLL REALTY, BROKERAGE
Listed on January 9, 2020 for $539,900, this one bedroom plus den penthouse apartment sat on the market in Markham for a couple of weeks before it was sold conditionally. A week later, that conditional sale status was removed as the deal had fallen through, likely due to a financing condition.
It went back on the market as available again on January 30th and on February 3rd, a new buyer showed up and bought it for $490,000. That’s 91% of the asking price and it was a firm deal with no conditions. The seller may not have been happy to take almost $50K less than ask price, but they had just seen a deal fall through and must have decided that a lower price that happened was better than waiting around for another deal.
Photo from ROYAL LEPAGE SIGNATURE REALTY, BROKERAGE
Listed on January 21, 2020 for $975,000, this four bedroom, four washroom house sat on the market in Whitby for just over a week before it was sold conditionally. The conditions were financing and a home inspection. Five days later, that conditional sale status was removed and the deal fell through.
It went back on the market on February 4th and on February 5th, a new buyer showed up and bought it for $920,000. That’s 94% of the asking price and it was a firm deal with no conditions. In this case, the seller took $55K less than ask price in order to get it sold firm. It was probably a tough conversation with the seller and the listing agent, but in the end the deal was done so that the seller could move on.
Photo from CENTURY 21 WENDA ALLEN REALTY, BROKERAGE
Listed on January 24, 2020 for $465,000, this three bedroom townhouse sat on the market in Pickering for a week before it was sold conditionally. The conditions were financing, status certificate review and a home inspection. Three days later, that conditional sale status was removed and the deal fell through.
It went back on the market on January 31st and on February 5th, a new buyer showed up and bought it for $440,000. That’s 95% of the asking price and it was a firm deal with no conditions. In this case, the seller took $25K less than ask price in order to get it sold firm. Given it sold firm this time, it is likely there were no problems with the status certificate for the townhouse complex or any issues with the home that a home inspection revealed. The reason the previous deal fell through was probably financing and this buyer didn’t have that issue, came in firm and got it at a discount.
The three above examples showcase what can happen when a deal falls through. Naturally, not all deals go this way and there are also examples of a deal falling through and the seller finding a new buyer at close to or even over their asking price. Timing is everything in real estate, however, and if you find yourself in a situation where there is an upset seller who just saw their deal fall through, it’s reasonable to say that seller may be more willing to take a lower priced firm offer now.
There are ways in which an experienced Realtor can make sure your deal doesn’t fall through and as we’ve discussed above, there are situations where working with the right Realtor means you can buy at a significant discount.