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I put in a bid on a co-op in mid June, which was verbally accepted. It then took almost a month for the seller's attorney to send over a contract. When it finally arrived, my attorney turned it around in two days, and we've spent the last two weeks waiting for word back from the seller's attorney. When asked for an update, he stalled every time.
Today, my attorney gets a two-line fax from the seller's attorney, indicating that his client "will not be moving forward with the transaction."
The listing agent explained that the seller negotiated his own separate deal with another buyer at a higher price than my bid. Listing agent swears up and down he had no idea what was going on until last Friday. This place needed a gut, so I've spent a considerable amount of time meeting with architects and contractors, which is now all for naught.
And just to add insult to injury, listing agent asks if I'll keep him in mind for the next time I'm looking at buying an apartment.
I wish this kind of behavior really was shocking. Sorry it happened to you.
Just out of curiosity, how many on this board would go back on a bid you accepted if you got a better offer after you accepted the first one? Would you do it without asking the original bidder to match the price?
meh, you learn fast that in NYC, you have to know how to apply pressure to get what you want.
Some people see selling an apartment as a business transaction, imagine that? So, if there is no executed contract then all's fair.
I guess you could have put an expiration date on your bid, instead of being Mr. Nice Guy patiently waiting for a MONTH for a response.
Ultimately, I am with you though. In a perfect moral world, your agreement would/should have been honored.
I can't tell you how many people I have encountered personally who do not encumber themselves with such high ideals. These are the inhabitants of the town we think is so great.
It's never a good idea to spend money/time on vendor consults until you're in contract. Either side can back out for any reason until signatures are on paper. That's the way this business works. The month wait for a contract should have alerted you that the seller wasn't interested in moving forward. Heck, waiting any longer than one week should have raised a red flag.
Flarf - next time you are involved in a deal don't wait 30 days to get a contract. That is your first major red flag. If a few days pass after the offer is accepted, and you don't have a contract, start barking LOUDLY. My sellers get a contract out within 24 hours of an accepted offer, and oftentimes sooner. Being patient for 30 days may have helped the seller in that he was able to entertain other offers and negotiate while keeping you on the sidelines...next time put pressure on during the first few days of the deal!!
PS - if this was an exclusive, chances are the agent knew what was going on, unless the new buyer was a neighbor or friend directly approaching the seller. Even if this happened, chances are the seller kept the agent in the loop..
What was your agent doing during this time? He or she should have been making a lot of noise as well over the lack on a contract after a few days of acceptance....
Flarf, I think you are somewhat to blame here. Did you not realize your offer was being shopped around? What did you think was going on for the past 6 weeks?
This reminds me of the Seinfeld episode with the chocolate babka. They waited on line for all that time, they thought they'd have the chocolate babka. But ultimately the person in line before them got it and they had no chocolate babka, only a cinnamon babka.
Seriously, flarf, stop being a little girl. The only rights you have in a business deal are in the contract and you sat there for 6 weeks hoping and praying that you'd receive a contract. I partially agree with inonada, except that I'm not sure anyone is the "blame" because I don't see anything that was wrong at all. The place went to the highest and best use.
Unfortunately, this happens all the time--your offer got shopped or used to bump up another's to a higher offer.
When selling, I received multiple offers after verbally accepting another offer. It would have been stupid of me not to take the highest offer I could have in this market, so I did, but I always gave the other party a chance to match. I sent out a contract only after securing the final highest bid, and even then, I gave an expiration date.
To comment on how that broker acted, that was definitely a sloppy way of handling things--you should have applied more pressure or forced an expiration date like others mentioned. However, hindsight is always 20/20, so all you can do is move on. Hopefully you end up with an even better apartment in the end.
Oh, I'm not claiming innocence here. I made two critical mistakes:
1) Settling for dual agency.
2) Not following through on my July 7th threat to walk away (to which the agent replied, "Just bring some more patience and we will have the job done" -- it got done, all right).
I just couldn't believe when the agent had the balls to: A) complain that he was still only getting 5% of the new deal, and B) asked if I would call him for representation when I find something new.
Agreed with Mets..I wrote about this on urbandigs.com a ways back:
"SELLER ATTORNEY (1-3 business days max)
Draw up a contract of sale and get it over to the buyer attorney for comments! The deal sheet is used to help draw up a contract of sale with all terms for the deal spelled out clearly. Generally, buyer and seller attorney will go back and forth editing comments until both parties are satisfied."
1-3 business days MAX! Your first warning sign was this. I assume you had no buyer agent to assist you in these types of consulting. I would never ever let a buyer client wait 30 days for a contract. I would advise after 3 days of a verbal deal deal sheet sent that something is very very wrong and start applying pressure or start contingency planning. The seller and their agent likely both knew another deal was there. They just kept you on as a backup. Its business, and if they had a higher deal, it sucks you didnt get a chance to match but I think its because you didnt have the right guidance. I would have put a 48 hour deadline on your offer after those 3 days of no contract were up, and withdrew the offer so the seller had no leverage to work on another deal. Just my two cents
"When selling, I received multiple offers after verbally accepting another offer. It would have been stupid of me not to take the highest offer I could have in this market"
I don't get it. Why did you accept the offer in the first place if you were really just fishing around for a better deal? Presumably rather than accepting, you could have been honest and said something like "that's a great offer; there's some other interest in the apartment, let me get back to you in 24 hours if no one else can do better?"
Sure, the contract is the only thing that's legally binding. It's also legal to use your cellphone in a movie theater, yet somehow most people manage to figure out that some behaviors aren't cool despite being within the law.
"Presumably rather than accepting, you could have been honest and said something like "that's a great offer; there's some other interest in the apartment, let me get back to you in 24 hours if no one else can do better?""
Yes, very true, but being on the other side of the deal you can't rely or assume this will be the case. You have to go by what protocol is and make your own interpretations on what might be going on should red flags pop up after a verbal agreement. As far as Im concerned, the seller and their agent are capable of doing anything, leaving me and my clients to rely on actions only.
...and here is another example of how a buyer's broker would have saved you time and money.
Congrats though, happens to everyone. It's kind of a right of passage.
In a few months, you'll be able to make snarky remarks at someone else in a similar thread! Circle of life kind of thing...
yes let's talk about borker etiquette while the dow marches towards the lows of 2009..... meh, I'm wondering WHO THE FK buys an overleveraged POS in Manhattan when we got $400 psf to fall bf June 2010.
FLMAOZzzzzzzzz carry on..... fking incredible.... the last 10 days just erased $100psf off of all NYC RE... but I'll let you ppl talk about protocols.......
what a drag... sorry that happened to you.
As digs has pointed out, the red flag was when the seller didn't send out a contract right after the offer was accepted (I would have given him maybe 4-5 business days, but I'm an old softie).
However during that time, I would have been working, constantly reinforcing to the seller that you were the "best" possible buyer on this property.
So that's your lesson going forward, if you want to try this again without representation -- every day post-offer is a contact, and you're re-presenting the high points that led the seller to take your offer in the first place.
Good luck and a speedy close on the next one.
DG Neary Realty
urbandigs -- I totally agree that a buyer can and should do things to mitigate the risk that the seller yanks them around in these situations. I just wanted to point out that it's possible to get a good price for your apartment without lying to people.
67...this is like the umpteenth time you've pointed to the stock market to say something, as if you have some insight into where it is going, and what it means for manh. re, but the problem is, virtually nothing ever works out as you predict....flmao...
quelle drag, sloppy on the sell side, you/your atty were way too patient. getting engaged with 3rd parties, wot until it was a done deal.
jordyn - its a good point..one can argue the seller and selling agent did not play the situation right. Why not create a bidding war situation, a best and final? Get two parties to submit their highest offer with chances of a gap up bid?
fkerfker.... for the umpteenth plus 1 time... the fking NYC RE is headed to $500psf..... flmaoz.... but feel free to comment on being slighted by a borker.... it'll get you far in life.
@jordyn: My broker already had an open house set up the next day after I received an offer and verbally accepted it. So, while the attorneys were going back and forth on the contract terms, someone from the open house made an offer 4% higher and all-cash. In this market, I don't see how ANYONE could have turned that down, especially since nothing was binding at that point. However, I didn't just take that offer and run; I gave the original buyer a chance to counter, which he did and ended up in a small bidding war with the other buyer. However, the second buyer won and ended up with my apt.
IMHO, it would be difficult to find another person out there who would have acted differently in my position, given the real estate climate and my particular situation.
jubu: Like I said originally, my response would have been "Thanks for your offer. I already have an open house scheduled for tomorrow, so I'd like to take 24 hours to get back to you on this." I don't see any problems in letting people know that there's a competing offer our using competing bids to get the best price, it's just accepting the offer in the first place when you're obviously still open to considering other options that seems unethical to me.
It is not at all uncommon for listings to continue to be shown for backup even after an offer has been accepted. Until the listing is in contract (signed and countersigned) either side may walk away for any reason and no explanation is necessary or required.
EVERY seller is 'open' to accepting competing offers until a contract is signed--another buyer can swoop in at any time during the limbo phase between accepted offer and contract signed. That's why a savvy buyer pushes to get into contract as quickly as possible.
Bramstar, what do you think it means exactly to "accept an offer"? You don't think it means you have entered into a relationship with the buyer even before the contract is drawn up and signed?
@jordyn, you sound like a much better than 99.9% of the population out there and kudos to you if you could really tell someone making a great offer on your place that he would have to wait 1 or 2 days before hearing back from you, especially in this buyer-friendly market. I got an offer that was great, had no offers prior to it so I told my broker that sounds good and tell the attorneys to start working on a contract.
At that point, while we both had an understanding, both parties could still back out and look at other apartments or buyers. By chance, I happened to have an even better offer come in and it would have been fiscally irresponsible of me to turn it down for an understanding that wasn't even confirmed in writing as of yet.
If I wrote a story on here about turning down that 2nd offer and then being burned by my 1st offer, I guarantee all I would get are responses saying how stupid I was to be so naive in this cutthroat market. I understand where you are coming from, but I had to make the best financial decision and that was it, period.
everyone is talking from the buyer's standpoint (in other words that the seller chose to go for a higher/better offer)
yet noone is mentioning the other side of the equation: when buyers parallel negotiate with multiple sellers, accepting an "accepted offer" and then walk away ... or when buyers just get cold feet and decide to drop the deal altogether.
of COURSE you need to continue showing to other buyers as a seller because you, as a seller, are also at risk until you have a signed contract.
this is where communication of intent is so critical during this phase of "i'll trust you if you trust me". it may not solve everything but it helps calm egos and worries that always arise once both parties have accepted the offer.
>>Bramstar, what do you think it means exactly to "accept an offer"? You don't think it means you have entered into a relationship with the buyer even before the contract is drawn up and signed?<<
The only 'relationship' that matters legally is the signed contract. Like it or lump it--that's the way it is.
Yes, 4 or 5 days max.
What should a buyer who wants to withdraw his offer do? At that point, should a buyer pull his offer in writing, or does he just move on, and tell them you changed your mind when/if the seller does contact you later?