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Ethics in selling.

Discussion in 'General Property Chat' started by Rugrat, 11th Jan, 2016.

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  1. Rugrat

    Rugrat Well-Known Member

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    Hypothetical question. I'm curious who will answer what.
    Senario is that you are selling a house and have accepted an offer. The day contacts are to be exchanged but prior to actually exchanging, another person makes an offer on the same property for 20k more (unconditional).
    What do you do? Continue with the first offer and exchange as planned? Or pull the pin and accept the new offer instead?

    Does your answer change if the difference in price is less or more? What is your threshold of ethics in this situation?
    ; )
     
    Last edited: 11th Jan, 2016
  2. neK

    neK Well-Known Member

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    Depends on how much i like the person who is buying it and their purpose (both set of parties).
    Price is negligible in this instance, but I would put to the first party and advise them that a newer party has given more and gone unconditional, my request is that they need to go unconditional too (money can stay the same).

    Basically it would go in this order for me

    1. Unconditional
    2. Not an a-hole
    3. Money
     
  3. Chilliblue

    Chilliblue Well-Known Member

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    We had a vendor who was placed in that position and decided to continue with the sale to us. He stated that we didn't stuff him around and stated that it would help his karma.
     
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  4. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Having been on the receiving end of this scenario numerous times, I'd go with the higher offer since it is still legal to do so. I might go back to the first buyer and give them the chance to match or improve on the higher offer.
     
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  5. MTR

    MTR Well-Known Member Premium Member

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    Been in the same scenario, would do the same.
     
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  6. Big Will

    Big Will Well-Known Member

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    When you talk about them being exchanged means the vendor has both sides signed but the purchaser doesn't? Then as a vendor you can tell your agent to cancel the contracts as no exchange has been made, this is why it is in the REA best interest to exchange contracts asap.

    If you are saying the agent has an offer (only 1 purchaser signature) but they have verbally agreed to it and the agent is going to get a signature then this is the reason why you do not talk about the offer over the phone if it is acceptable... Real estate 101.
     
  7. Ed Barton

    Ed Barton Well-Known Member

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    I wouldn't be selling a property for 20k
     
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  8. Rugrat

    Rugrat Well-Known Member

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    Lol. Fair enough. Typo. Was supposed to be 20k 'more'. :p
     
  9. Greyghost

    Greyghost Well-Known Member

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    Depends on what you are selling!
     
  10. WattleIdo

    WattleIdo renovating Premium Member

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    If I could get the signature to match the higher offer, I would halt proceedings, inform the first purchaser and see who could give me the best price and conditions.
    On the other hand, if I was tired and over it, I might just keep going with the original arrangement. Not likely, though.
     
  11. Scott No Mates

    Scott No Mates Well-Known Member

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    S66W from both parties or no party for anyone.
     
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  12. Ed Barton

    Ed Barton Well-Known Member

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    I know. My post was for ****s and giggles.
     
  13. Ed Barton

    Ed Barton Well-Known Member

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    What sort of property sells for $20k in oz?
     
  14. Scott No Mates

    Scott No Mates Well-Known Member

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  15. Xenia

    Xenia Adelaide Property Manager Business Member

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    I would tell the first offer that we have now recieved a higher offer and to put forward their best and final.
    Go with the highest.
     
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  16. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    Personally I would go with the initial party as I am an ethical kind of guy and when I agree to something I dont back out of my agreement.
     
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  17. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Could you get over your ethical dilemma if, when accepting the offer from the first party, you said that your "property stays on the market and is open for all offers, until an unconditional exchange"? :)
     
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  18. albanga

    albanga Well-Known Member

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    It's a no brainer to me. Go back to the initial purchaser and give them the opportunity to match it on unconditional terms, if they are not interested they lose it to the new party.

    Think about what 20k almost pure profit could do for you and your family. In terms of ethics ok maybe not entirely ethical but it's a long way down the list of something bad. If it happened to me I would be annoyed but would say "ah well it was meant to be" and keep looking. It's not like I've lost anything.

    For the vendor though 20k could be the difference between a better school for the kids, money for health down the track, or heck a much needed holiday with the family.
     
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  19. albanga

    albanga Well-Known Member

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    And dont forget that 20k is going to compund. If your selling chances are your buying again so 20k of the life of a loan is a lot more than 20k.
     
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  20. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    I dont really see it as a dilemma.... if I accept an offer then I consider it at a level that I am happy to sell at.

    That being said, it would also depend on the first buyer. If they were morons and had been difficult to deal with then I may consider the increase your offer game, but generally I stand by my word.