During the course of my real estate career, I have worked with many ethical real estate investors. True gentlemen/women, the type where a handshake is as good as a signed contract. But in today’s real estate climate, a new breed of real estate investor is in town. These “investors” tie up a piece of property and then shop it for their investors. I have had this on two different listings in the last several years.
The investor buyer acknowledges receipt of disclosures, inspections, etc. We negotiate a selling price and open escrow. Often their earnest money deposit never makes it to escrow. When pushed to honor the terms of the Real Estate Purchase Agreement and get their money to escrow, there is a request for a price renegotiation. After they have shopped the property to their investor pool and by the time they collect their finder’s fee, they decide that their initial offered price was too high to make the numbers work.
Each time this occurred, it resulted in a canceled escrow and, sadly, unnecessary stress for my client. A great real estate agent learns from her mistakes. When I list a fixer-upper, I address the investor dilemma with my client. When dealing with real estate investors, often, my clients decide that the offer will not be considered without a cashier’s check and a non-contingent offer.
Seems harsh? Of course, not all investors can be painted with the same brush, but if I am unfamiliar with them, I must remember the adage: Fool me once, shame on you, fool me twice, shame on me.
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Real estate investors love to renegotiate
