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Beware of deep discount-buying flipper companies.

April 13,2023 | Posted By Flavia Brown in Real Estate
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This is a heads up for homeowners who need or want to sell their homes. I am advising home sellers to be aware and not get duped into selling to real estate flipping companies like “We buy houses,”  “We buy houses for cash,” and “We buy ugly houses.” They prey mostly on owners of distressed, pre-foreclosure, off-market, long-time-on-market, and fsbo properties. It will be a costly mistake to sell to those companies for several reasons. The biggest reason is they buy houses 35% to 50% lower than fair or true market value. Unfortunately, these unscrupulous companies will survive at least for a while longer because they have strong, but deceptive marketing programs. They also have a few dirty tricks. One damaging trick they have mastered is offer a fairly high price, then after the seller accepts the offer they negotiate a lower price based on any needed repairs. They will get away with it especially if the seller needs to sell quickly, which is usually the case. Unfortunately, this could get worse for the buyer. The flipper company (the new owner) renovates the house with low quality material and workmanship, then puts the beautiful house on the market. The good news is that the interested buyer will order a professional home inspection during the 17-day investigation period after the offer is accepted, and will either negotiate the cost of additional repairs and upgrades, or canceling the contract.

It is true that these companies sell houses quickly, that is if homeowners are willing to take a financial beating. However, a good real estate agent with a strong and effective marketing program will also get homes sold quickly AND at the highest price the market will bear. In fact, that is part of a Realtor’s contractual fiduciary duty to the seller.

My advice to homeowners who have been solicited by these devious “We buy houses” franchises, or to owners who have been thinking of selling to them, is talk to a savvy Realtor or a real estate attorney. A good Realtor can get your home sold at the highest price possible and quickly, and will watch out for your best interests and legal requirements. It doesn’t matter whether the property is a distressed,  “as-is,” or an immaculate move-in-condition house. I will do what a Realtor is supposed to do, plus help with your closing costs, and help find or create a good deal on a replacement home if that is relevant. 

Mainly, I will get your home sold at top dollar and fast. Also, I know how to deal with late mortgage payments and delinquent property taxes when sellers have those issues to contend with. 

Best regards,


Flavia

P.S. The latest edition of the residential purchase agreement used by 95% of California home buyers when making offers is C.A.R form RPA (16 pages of small print). For the asking I will email a filled-in sample copy and my brief explanation of each paragraph for easy reading. Zero cost.
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