The High Road: Best and final offer is illusory

There is normally no magic involved in choosing a best and final offer. (Flickr photo by Emz.watson)

We are told early in the week that the listing broker already has two offers in hand.  All other offers are due by Friday at 5 p.m., she says.

Fair enough, but then she adds that best and final offers have a deadline of the following Monday at 5 p.m.

A double-deadline in advance is strange, indeed.  What usually happens is that a listing agent has several offers in hand, doesn’t see a clear winner and only then, in concert with the seller, asks for best and final offers.

That’s the typical procedure.

The High Road: I broke every smart broker’s rule

(Flickr photo by litherland)

I have no one to blame but myself after I took on a new buyer.

Cindy is an acquaintance who e-mailed me one Friday saying that she was toying with the idea of moving out of her nearly $4,000-a-month rental to purchase an apartment on the Upper West Side.  Could we chat sometime? she asked.

I spent a couple of hours with her the next day explaining the process to someone who had lived overseas for decades and, like any first-time buyer in Manhattan, knew little about co-ops and condos, let alone what she needed to do to buy one.

It was a good conversation, in the course of which I went on at some length about steps that Cindy hsf to take to obtain a mortgage, retain an attorney and make an offer before going to contract.

She indicated as we talked that there was some urgency to get moving because

First-timers often focus fears on wrong questions

The only thing buyers need fear is fear itself. (Flickr photo by juanpg)

It is a fear that I have a felt myself: Buying real estate is scary.

However much anxiety that the process plagues first-timers, the fear seems to all but disappear with subsequent purchases.

Although it is incumbent on any buyer to assess the risk, it also is true that

Buyers need to get truly organized as they search

Your own spreadsheet doesn’t have to be as complex as this one. (flickr photo by Ivan Walsh)

The search for a new home can be fun. But it also can be frustrating, exhausting and confusing.

To emphasize fun, the wise course is to get as organized as possible. That is the case even if you are the sort of person who values spontaneity, impulsiveness and instinctive decision-making above all.

One useful approach is to assemble a loose-leaf notebook or its electronic equivalent.

Begin by

Sellers always have the last word on offers

Submission of a back-up offer is where the rubber meets the road. (Flickr photo by theilr)

Back-up offers exist in the gray area of real estate transactions.

Nobody likes them more than listing brokers and their clients.

Don’t sign contract without financing contingency

Weekly Roundups will resume starting April 5

Lawyers start with boiler-plate contracts, and the terms that they add are intended to provide essential protections.

In this nascent world of restrictive credit standards, anyone buying a new home needs to expect the expected.

When it comes not only to getting mortgage approval but also to getting promised funds, buyers can count on roadblocks that could delay or even prevent settlement.

That is why it is essential for their attorneys to include appropriate financing contingency clauses in the contracts.  Those clauses allow buyers to have their deposits returned in the event that lenders don’t finally provide the money to close.

Considering that the usual deposit of 10 percent of the purchase price — $40,000 on just the $400,000 purchase of a studio apartment — is a substantial sum, contingency clauses are not to be taken lightly.

Notes Forest Hills lawyer Ryan J. Walsh, whose explanation I’ll paraphrase liberally below, there are three major contingencies that can protect a buyer:

Buying sight unseen is not for faint of heart

(Flickr photo by MadEmoiselle Sugar)

Anyone who purchases an apartment from floorplans probably knows that opportunities abound for making a mistake.

An article in the New York Times last year provided a good rundown of issues that buyers should explore before signing on the dotted line for apartments in buildings yet to be completed or, on occasion, even started.

Some of the concerns that the wise buyer of such apartments ought to bear in mind center on the following:

Going it alone possible but far from perfect

Mayra David’s dining room undergoing renovation (Source: BrickUnderground)

You can well imagine my negative reaction to a post I read a while back from a buyer who decided to shun the help of a real estate broker.

Writing on the BrickUnderground site, Mayra David says she and her husband learned a lot from the process, though she concedes that proceeding alone may not have been the best idea:

In retrospect,

Perfect pitch may hit the wrong chord of law

(Source: the U.S. National Archives)

The headline went like this:

“Can I Buy Your House, Pretty Please?”

In the Wall Street Journal, the article by Joann S. Lublin noted that the housing market has changed in some areas.  As the subheading observed:

With inventory tight and prices rising, buyers in competitive markets like Silicon Valley and Seattle are returning to a boom-era tactic: writing heartfelt letters to sellers explaining why they should win the house. Signing with a paw print.

The piece is accurate in pointing out that an emotionally charged letter from a buyer can sway a seller who is considering more than one offer.

Referring to the missives as “pitch letters” or “love letters,” Lublin correctly reported that

Weekly Roundup: Early spring, Borgnine mansion, slumping inventory, Case-Shiller attack, DIY tips, increasingly confident Americans, builders’ mood

Governor signs renewal of tax abatement into law

Construction permits take off from 2007 level

Market reveals early spring as pace of pending sales below $5 million is fastest in 12 years

And jump recorded in development activity of multi-family buildings in Brooklyn

Although nothing new, garbage disposals prove to be worthy of boasts

Cuomo seeking to buy out homeowners to remake coastline

Concessions dwindling for buyers of new condos

Will rents take off again?  Maybe: Low inventory continue to push up rents of studios, 2BR apartments last month

Region’s housing prices up 8.5 percent from prior December

Big uptick in supply seems unlikely

Her Greenwich Village duplex is coming around again

Late-night newswoman decamps to $5 million