When you’re buying or selling real estate, you need, at a minimum, a buyer and a seller. While that’s a pretty low bar, not all properties are created equal and not all buyers and sellers are equal in their ability to close a transaction smoothly, without problems, and on time.
Over time, we’ve identified certain red flags that tell us that the person on the other side of the deal may be less than ideal. While looking for perfection in the party on the other side of the deal can be counter-productive, it is smart to not overlook clear indications that this deal could be trouble.
Here’s three red flags to watch out for when you’re selling a property.
Buyer Red Flag – Not Respecting the Rules
When you are selling a property, you establish how that sale will proceed. This includes when the property will be available for showings, what timeframe we’re asking for with offers, requested deposit percentage and so forth.
When a buyer is violating those rules during the for sale period, it’s a red flag that they won’t follow the rules during the conditional period or after it firms but before the sale closes.
If you see a buyer who wants to do things their way from the beginning, it’s likely they won’t suddenly become a considerate person who does things as requested throughout the process.
Buyer Red Flag – Not Listening to their Agent
A corollary to the first red flag above is when a buyer doesn’t listen to what their agent says.
There are pretty specific rules about communication in real estate. Agents communicate with each other and with their respective clients. We aren’t permitted to communicate directly with another agent’s clients unless it is discussed and agreed upon. This is something that the majority of buyers and sellers understand and respect.
If a buyer disregards this or other advice from their agent, it a clear red flag that they think they can do things however they want. If the buyer’s agent isn’t in control of their client and is merely relaying what the buyer wants, it is a sign that things are not going to go smoothly. If you ever hear a buyer’s agent abdicate responsibility for their client and say that’s just what my client wants, be wary. An important part of the role of a Realtor is to help the client understand how transactions take place and to make sure they move smoothly. If a buyer isn’t listening to their agent, problems will start occurring.
Buyer Red Flag – Not Living Up to Promises
Real estate transactions are done through written contracts that clearly specify the terms of the transaction. In addition, throughout the showing, conditional and firm period, there are promises made on both sides.
If a buyer shows up late to a booked showing, or not at all, it’s a potential red flag. If the deposit cheque that is required to be provided within 24 hours isn’t available for longer with no prior discussion, it’s a red flag. If the conditional period for a mortgage review is five days and on the fifth day the agent finally says they need more time after ignoring requests for updates, it’s a red flag.
In general, people behave consistently in one way or another. A diligent, responsive buyer is unlikely to turn into a reluctant, unresponsive buyer partway through the process. If the buyer is consistently failing to live up to promises (verbal or written), then it is a red flag that the rest of the deal will continue in this fashion and perhaps not successfully transact.
Just like on the buying side, there are red flags that indicate a seller is going to cause problems with a deal.
Seller Red Flag – No Attention to Detail
A huge benefit to being on the buy side is that, in many cases, you get to see how the seller lives. While sellers often present the best-case version of their home, it is impossible for a seller to fundamentally change who they are and how they live.
If you’re visiting a home and it looks good on the surface, but closer examination reveals a different story, it is a red flag that the seller is not someone who is focused on the details. When you see a red flag like that, it means you will need to look closer at more aspects of the home. Such a seller is unlikely to have done regular maintenance on the home or properly cared for the mechanicals or appliances.
Seller Red Flag – Lack of Consideration
While things have changed in 2020 with the rise of COVID-19, the physical showing of a property is still an important part of the buyer process for many buyers.
If a seller has severely restricted showing times, fails to leave the home ready for showings (snow not shovelled for days, lights left off in the evening when they leave for a buyer showing, etc.) or generally treats potential buyers as intruders rather than guests, it is a red flag.
Such a seller will likely continue to not show consideration for you as a buyer during the rest of the process and if there is a situation that requires flexibility, it is not likely to be given.
Seller Red Flag – Unprepared to Show
The final red flag for a seller is when you encounter a property that is clearly unprepared for showings. When the seller has made little to know effort to prepare for potential buyers to see the home, it is a sign that they are not motivated to sell or don’t think they should have to change a thing about their lifestyle in order to sell.
These types of sellers often give off a vibe of you being lucky to see their home and this attitude often extends into the negotiation process. Such a seller is unlikely to be willing to listen to reason when it comes to negotiating and often won’t care about what is important to you as a buyer.
If a deal is done despite such red flags, it is very important to monitor the process through each step of the sale. Such sellers are much more likely to drag their heels when hiring a lawyer, movers, packing and leaving the property in good shape.
No buyer or seller is perfect and sometimes the best opportunities come when the party on the other side has exhausted or angered other potential options for them to get a deal done.
If you work with a Realtor that understands the red flags, they can help you avoid problems or steer you through them to a successful completion. If that sounds appealing, we’re here to help move you forward.