Short Sales Are Distressed Sales! Please Prepare Your Buyers
Like many agents around the country these days, short sale listings are becoming a large portion of my business. I have listed and sold many of them over the last few years. Admittedly, I had a leg up on most agents, as I've been engaged in short sale negotiating for the past 10 years, before most others even knew what a short sale was!
One of the most frustrating issues with short sales is NOT dealing with the sellers or even working with the all too often uncooperative bank negotiators. Yes, sometimes both can be issues, but I find that the most frustrating aspect of listing a short sale is the buyers and their agents.
Yep, you heard right! Actually, I feel that it's the buyer's agents more than the buyers. From the feedback I get on short sale listings, it's very clear that the agent did not prep this buyer at all about what a short sale is or what may be required.
The most common feedback is "Too much work required for my buyer." In most cases, short sale listings generally require some paint and carpet (or flooring). If this is "too much work" for your buyer, then you probably shouldn't be showing them any short sale properties.
The best feedback is when it goes something like, "House needs to be staged, painted, new roof, etc, etc, etc," When I get these, I'm tempted to respond with "did you look at the price" as we've taken all those into consideration already.
I really think it boils down to a lack of preparation from the buyer's agent. A short sale is a distressed sale. I wonder, do these same agents show foreclosures and give the same type of feedback? I doubt it. We all know that foreclosures are distressed sales and are generally sold "As Is, Where Is" and we prep our buyers for that. Yet, when (at least from the feedback I get) some agents show Short Sales, for some reason, those properties should be in pristine condition, require no work whatsoever AND be priced lower than other comparable homes on the market.
Please, if you're going to show short sale listings, make sure that you're educating your buyer on the process, including the fact that a short sale is a distressed sale and it may not be in perfect condition!