Real estate ethics question

minneapolisiteJune 22, 2012

We have 3 offers. #1 is the best offer, but it's still effectively $6,000 below our asking price. #2 and #3 are comparable offers. We know enough about #1 to know it is her final offer. The other 2 could be negotiable.

#2 happens to be friends-of-friends (I facebook stalked them and discovered they went to my university). I am tempted to contact them (or their real estate agent) and say: "This is not a counter offer, but if you were to offer X by noon today, we would basically start packing our bags."

Is that unethical?

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As a seller, there's no reason you MUST sell to the highest bidder. In fact, I know people who've sold even though the buyers were NOT the highest bidder but because the sellers felt the party was such a nice family. (To be fair, the bids were pretty close so we're not talking about huge money, but money is money and they were willing to take less because they thought the buyers were nice.)

I've read in the newspaper about art collectors who decide to sell at a lower price to a museum instead of a private party again because of the common good. If the university bond you have is something you enjoy fostering, I think it's fine.

Best of luck and hope things work out to your satisfaction.

    Bookmark   June 22, 2012 at 8:38AM
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"Is that unethical?"

If the offer was made through an agent, you should send any notes etc through that agent. It would not be unethical to tell them that you have multiple offers and they will need to come up to x price to make a deal.

    Bookmark   June 22, 2012 at 9:50AM
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I wouldn't want to sell to friends of friends. murphy's Law will have something very major break the day after closing. There go the friendships all the way round.

    Bookmark   June 22, 2012 at 11:31PM
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For about $500, you can provide them with a service contract that will protect them for the first year;
if a covered appliance or system breaks down (dishwasher, waterheater, air conditioning, etc), the homeowner calls the service provider.

For a service fee, usually $65 or $75, the repairman checks the item & repairs or replaces it.

The homeowner is delighted to have something break:
he gets it fixed cheap...
or he gets a new one.

    Bookmark   June 23, 2012 at 10:47AM
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"he gets it fixed cheap... "

Over, and over till contract expires.

And if the service company decides that it WILL cost THEM less to replace, you will get the lowest quality unit and labor.

The low bidder.

    Bookmark   June 23, 2012 at 11:23AM
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The service guys for the home warranty company came out 7 times to get the microwave fixed (a thermador 3-in-1 unit, w/oven & warming drawer, no longer made in the exact size). Luckily I'm a stay at home Mom or else you would have to take off 7 days from work ... not really so cheap!

    Bookmark   June 23, 2012 at 1:43PM
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>he gets it fixed cheap...
or he gets a new one.

Tee hee. When I was renting the owner had a service contract. They came out every three weeks for almost 6 years to fix the AC, because the company policy was that it was cheaper for them to just keep pumping refrigerant in rather trying to locate and repair the leak.

Somehow the owner had managed to get the DW replaced by them, which was such a notable event that the other unit owners used to come over to look at it. (And they replaced a top of the line kenmore with the cheapest roper available.)

    Bookmark   June 23, 2012 at 3:01PM
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FWIW on service contracts mixed results. On one house I bought I had a plumbing problem and the service company sent out a plumber who after 3 hours said it was too hard for him to figure out and left, leaving my toilet sitting on the floor not bolted down.

That said, the next plumber quickly realized it was a septic problem and the septic company came out and did a $2000 repair and I ended up paying only the one $65 or so fee.

With that exception of the one plumber, I've found that generally the service companies do use reputable companies for repair, often the one I would have called in the absence of the contract. On our newest house, we have a service contract and the microwave went out soon after moving in and the service company sent out Sears to do the repair and they did good work.

    Bookmark   June 23, 2012 at 3:52PM
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>the service companies do use reputable companies for repair

This is very different from the way it works in my area. There are two large companies offering this sort of contract here, and neither uses any other company for the repairs, just their own jack-of-all-trades-master-of-none low-paid employees. They never send out a real licensed plumber, for instance.

    Bookmark   June 23, 2012 at 4:44PM
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sorry, by "he gets it fixed cheap", I meant that he gets it repaired or replaced for the service fee only.

The first time I placed a service contract on a house, many years ago, both water heaters & an air conditioner went out the first year.

The homeowner was delighted;
water heaters & air conditioners *will* go out, & he got brand new units for under $200 out of his pocket.

The service companies have contractors who give them a discount for the volume of business.

A service company isn't an insurance company, so you are not indemnified;
you don't necessarily get like for like, you get builder grade, but if you prefer, you can get a check from the service company & buy your own replacement, or you can get the contractor to install an upgrade & pay the difference.

Service contracts aren't the answer to every prayer, but they fill a gap.

    Bookmark   June 24, 2012 at 12:03PM
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