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The Tallest Realtor in Town

Hill Country and Highland Lakes Real Estate Blog by Jeff Spears, 6 ' 7" Tall.
How Do You Contingency Offers Work in Real Estate?

The local real estate market around Lake LBJ is very robust.  Central Texas as a whole represents one of the most active markets in the country.  As buyers desire to move to our area, they may have an existing property to sale first.  This results in offers contingent on the sale of other property by the buyer.  This type of transaction can be beneficial for both parties and is worthy of consideration.

If a seller accepts a contingency offer, their home stays on the market for other potential buyers to consider.  If another buyer makes an acceptable offer, the seller notifies the first buyer. The first buyer must waive their contingency and agree to purchase the home whether they sell their existing property or not.  If they do not waive their contingency, the first offer is terminated and the seller goes under contract with the second buyer.

One drawback of accepting a contingency offer is that buyer’s agents may be less likely to show your home.  Some agents and buyers may feel their chances of securing a deal are less likely as the first buyer has first right of refusal.  However, most buyers with contingency contracts are only able to buy the new home with proceeds from the sale of their existing home.  In other words, the first buyer often has to terminate their contract which allows the second buyer to achieve a contract to purchase.

Sellers often benefit by receiving a higher price with contingency offers.  The buyer may pay more for the home as an incentive to the seller to accept a conditional offer.

As with all real estate transactions, each individual must assess their situation and decide what is best for them.  Your real estate professional may provide valuable advice in most situations to assist with your decision.

Curious about any local real estate topics? Please submit questions by email at jeffbspears@gmail.com, or feel free to give me a call on my direct line at 325-248-4369.  

Jeff Spears is a Licensed Broker in the State of Texas.  Each Office of Keller Williams Realty is Independently Owned and Operated. If you have a contractual relationship with another Broker, this is not a solicitation for your business.

Posted: Saturday, February 27, 2016 1:45 PM by Jeff Spears


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