What I expect you to know about real estate
For those of us on Medicare, this is the time when insurance company mail floods our mailboxes and inboxes.
My preferred plan is called “Medicare Out-Of-Mind”. I have no desire to change my primary doctor because I don’t want to learn about another network of providers practicing their medical specialties.
The only time I changed plans was when my primary physician and the affiliated health care providers left my insurance company for another.
At the time, among the deluge of related mail, a one-page letter from an insurance broker stood out. We met at a coffee shop. He spent a good hour teaching me the ins and outs of “insurance care”. Often, that’s what we mean when we say “health care.” Now, every year he sends me another letter outlining my options. He summarizes well and highlights the important stuff. I discard the slick mass mailings from insurance companies unopened.
You see, only a few of us are interested in the intricacies of health insurance or, for that matter, car insurance. It’s when we need to see a doctor or had an accident, that the need to know becomes real and sometimes urgent.
Is there anything you should know about real estate?
The same applies to real estate but only more so. Health concerns can be constant. Real estate dealings are rare and infrequent. When the last thing on your mind is buying or selling a home, why should you care about the process? What should you know about real estate?
That’s not to say real estate is a boring topic. However, even binge-watching HGTV or using Zillow to check out the mansion of your ex-wife’s new husband doesn’t convey expertise.
All of my clients are intelligent, some more so. All are busy people. They lead lives, have children, friends, events, interests, work, and worries. What they know about real estate needs to be refreshed, sometimes newly established.
Inform but don’t overwhelm
In the first conversation with a new client, who wants to downsize and sell a home of 30 some years I mostly listen. I have to resist the temptation to impress with detailed knowledge. I want to inform but not overwhelm. Timing is important. There is the need to understand the big picture but learning about details before they matter can cloud that picture.
With a new client, it’s all about building trust. That takes time. Will I get my earnest money back? I assured the buyer he would, provided we play by the rules. I explained those rules. After we rescinded an offer the earnest money was refunded. With the arrival of the money in my client’s bank account, the other deposit was a large amount of trust.
Forms for everything
There are dozens of forms for selling and buying real estate. I make them available before they are needed. The average purchase and sale agreement with addenda is 18 pages. The Purchase & Sale agreement is five pages. The general terms on four of these pages are explained with 4,028 words. That’s 47 times more words than I’m allowed to describe your home on the MLS.
Most of my clients don’t read these forms. I know that because they often ask me questions which are all addressed in these forms. They look to me for guidance along the way. They assume I know what I’m doing. That’s why they don’t need to know about real estate.
No app for the toilet leak
With the market cooling, escalation clauses are out and home inspections, wouldn’t you know, are back in. The inspection phase is the most stressful one for buyers and sellers alike. Form 35R, the Inspection Reply, can be the make or break document of the transaction. The mutual agreement is in serious jeopardy unless both sides understand that there can’t be a winner take all scenario. Even with a compromise on what’s to be done, the transaction can still go down the drain. At the final buyer walk-through, three days before closing, the moisture meter reveals that the buyer did not fix that leak around the toilet. No new technology, no newfangled app can solve this problem.
Residential real estate is a highly personal business. I enjoy this business because I’m at heart a teacher. Buyers and sellers are my students. Each successful transaction is like a graduation. Only, I don’t expect my students to remember anything they have learned.
Until next time, there is no need to know.
First published by Gerhard as his
October 2018 View from the Street Newsletter.