There is a new tactic emerging amid real estate negotiations in Thunder Bay, and I’ll refer to it as the ‘The Ransom Demand’, as that is the most interesting way that I’ve heard my colleagues refer to it. While I can’t speak for the Agents that are utilizing this tactic as a means to an end, what I can speak to is the general perception that such a ransom demand creates.
Have you ever really thought about the differentiating characteristics between a great salesperson and a maybe not so great salesperson? Really thought about it, outside of the numbers, final ‘output’, awards, and ends closed? A great salesperson is an awesome leader, a friend, a coach- someone with expertise that you can count on, and most certainly someone who has earned the trust and respect of many. These are the people that demonstrate real negotiation skills, empathy for their Clients as well as others, and are always looking at the bigger picture.
So what exactly is this ransom demand? And how in general is it interpreted amongst Sellers?
The 11th hour ransom demand usually occurs as follows;
- Conditional offer is put in on a property
- Sellers accept the conditional offer, with conditions to be firmed in one week
- Mid week- Home Inspection is completed, no negative feedback is passed on to the Sellers Agent for discussion with their Clients
- Conditions are to be met at 11:00 PM on a Sunday night
- 10:55 PM on the night conditions are due- Buyers Agent texts or emails a lengthy list of knit picky ‘deficiencies’ with the property, and demands X amount of dollars off the agreed upon price or they will not firm up their deal.
- Seller is either intimidated into accepting the deficiency list and lowering their price, or actually takes a stand and finds another set of Buyers to do business with.
From my viewpoint, the ethical timeframe to provide feedback to a Seller on ‘deficiencies’ that were discovered during a home inspection is within a reasonable time period after the home inspection. Sellers are generally very happy to work with Buyers when unanticipated things crop up in an inspection. For instance- the furnace is older than was originally thought, the shingles are a little rougher for wear than was believed, there is an electrical issue that needs to be resolved, or another such safety issue. You get the drift. When an Agent is confident in their ability to negotiate on fair terms, they will generally want to bring these items to the table early in the process so that a favourable outcome can be reached between all parties.
In general, the 11th hour ransom demand tends to go over like a lead balloon with Sellers. My most recent encounter with such a demand when something along the lines of this;
- Conditions due up at 11:00 PM.
- Lengthy text from Buyers Agent received at approximately 10:58PM citing a list of deficiencies and an amendment to price.
- Contact my Sellers to relay the lengthy knit pick list and price reduction demand.
- Seller conveys their shock that this might actually be what some professionals would consider to be a sales technique
- Seller decides that they won’t do business with ‘Terrorists’. (Their *exact* terminology, minus a bit of extra adjectives).
I don’t believe that the 11th Hour Ransom Demand is going to be around for long, but in the meantime, I really do hope that Sellers are being helped to stand up for the offer that was accepted, and to understand the difference between ‘knit picking’ and real sticking points during the negotiation process.