The Five Biggest Reasons Marin County Real Estate Deals Fall Apart
Not every real estate deal goes through, even in Marin County. Occasionally, a transaction is cancelled, for various reasons.
The main reason the standard contract allows 17 days to inspect a home is to protect the buyer. It’s called the discovery phase, or due diligence period. Call it whatever you want, but use it wisely, because if the buyer agreed to liquidated damages (99% of buyers do), then the buyer is on the hook for that money if they try to back out after contingencies are lifted.
I don’t know if there are official statistics on this anywhere, but we’ve had three cancellations in the last six weeks. We’ve also had four deals close, and three go into escrow, so it all balances out - but we’re not used to cancelled deals, so I started looking at why deals fall apart. Here is my unofficial list.
1. “I found something better.”
This happens more than you think. As noted, the buyer is allowed to cancel anytime in the 17 day contingency period if they find something they don’t like about the property. It doesn’t have to be specific - although it really helps your agent’s reputation if it is. We once had a client who had a spritualist inspect a property to see if it was haunted. Fortunately, it wasn’t, but I’m sure she would have walked if she thought it was. I’m not sure if that becomes a future disclosure item or not - does anyone know the answer to that?
Anyway, people don’t stop looking just because they’re in contract. It’s natural to look for reinforcement once you’ve made a major buying decision, by examining what else is out there. People will often continue to regulary look at open houses once they’re in contract, and if they have doubts, and they find something better…well, then you’re dealing with a cancellation.
Tomorrow: Reason No. 2: Foundations
