WASHINGTON – In today’s real estate market, there is proof that sellers have the upper hand.
Long and Foster real estate agent Eldad Moraru says he is starting to see confident sellers include a “home of choice contingency” in their contracts — a clause that means the seller does not have to finalize the sale until he/she finds another home to buy.
Moraru explains sellers are confident because they are receiving multiple offers on their homes and thus want to protect themselves in case they are unable to find a home to purchase, due to low inventory.
If the seller can’t find a home, Moraru says he/she has the ability to void the home’s contract.
The amount of time the seller wants to find a home to purchase varies and is negotiated by the seller and buyer. Moraru says the typical range is from 45 to 60 days.
While convenient for the seller, home of choice contingency contracts are not always ideal for the buyer.
“You’re stuck waiting and hoping that the seller finds something in those 45 days,” Moraru says.
He also explains that buyers who are locked into that type of contingency miss out on 45 days of potentially finding another home for sale.
“It’s tough for buyers right now, it really is,” Moraru says. “Sellers can now place demands they couldn’t, absolutely could not, a year or two or three years ago.”