Steve Meyers is a real estate agent/Realtor with RE/MAX Metropolitan in Shelby TWP and a member of the RE/MAX Hall of Fame. (Photo provided by Steve Myers)
question: You may have seen some home listings list the best offer and best offer by a certain date and time. If I submit the highest offer, does the seller not have to accept my offer?
answer: no. Sellers can accept whatever offer they feel is best for them. It’s not always the highest offer. Here is an example scenario: His asking price for the home is $350,000. The listing agent was using comps to drive up the value of the asking price to support her $345,000 value from $340,000. Offer 1 is $365,000 with 5% down on a conventional mortgage, 30 days of occupancy at the seller’s cost of $75 per day, a $5,000 appraisal guarantee, and a 10-day home inspection for the asking price exceeds. Offer 2 is his $362,000 with a 25% discount on his conventional mortgage, 45 days of free move-in, no appraisal guarantee, and a 7-day home inspection, exceeding his asking price. Offer 3 is a $360,000 cash sale (no mortgage or appraisal), 60 days of free occupancy, and 3 days of home inspection. There may be other factors in the offer that influence the seller’s decision, but in this example, the seller could either compete with the cash buyer with a higher price, or the first because the comps are higher than the amount indicated. You may choose to accept the offer. In the mortgage valuation (there is no question of value). The first 60 days after closing are free for sellers, and the occupancy rate is the highest, and the home inspection period is also the shortest, at three days. As this example shows, sellers have more to consider than price. This example just scratches the surface of what you need to see in your offer.
question: I’m preparing to sell my parents’ house. My mother and father are both dead. Do I have to tell the buyer that my mother died in the house? It was from natural causes. Someone told me that you have to do this every time someone dies in your home.
answer: wrong. What you are technically asking is whether this is considered stigmatized property. The National Association of Realtors defines a stigmatized property as one that has been psychologically affected by an event that has occurred or is suspected of occurring on the property, and that such event is of any type. There shall be no physical impact. This definition includes homicide scenes, suicide scenes, death scenes, and infectious disease-related illnesses. Some states have enacted laws governing these issues, but to my knowledge Michigan has not yet. According to the Seller Disclosure Act and Michigan common law, sellers of residential real estate are not required to disclose non-physical defects associated with the property. As always, we recommend that you consult an attorney regarding these matters.
question: Refrigerator ice makers don’t always work properly. Symptoms appear every few months. This situation has been going on for 10 years. Do I need to disclose it on my Seller’s Disclosure when selling my home?
answer: Yes, it should be disclosed. As always, if an item in your Seller Disclosure Statement isn’t working 100%, note that in your Disclosure Statement and be honest and transparent about everything. If you don’t, you could be in big trouble when the item breaks down and your neighbors tell you they’ve had problems with it for years. This is the same as marking “yes” that the heating system is working, but it may stop working when the temperature drops below 20 degrees.
Market updates
Below is the September market update for the Macomb and Oakland County housing markets (home and condo sales). In Macomb County, the average sales price increased by more than 7%, and in Oakland County, the average sales price increased by more than 10%. Macomb County’s market inventory decreased by approximately 45% and Oakland County’s market inventory decreased by approximately 35%. Macomb County’s average days on market was 21 days, and Oakland County’s average days on market was 24 days. Macomb County’s closed sales were down 41%, and Oakland County’s closed sales were down more than 42%. Closed sales continue to decline as a direct result of continued inventory shortages. Demand remains high. (All comparisons are monthly and yearly.)
According to the long-standing historical definition by the National Association of Realtors (NAR), which has been around since 1908, a buyer’s market is when there is more than seven months’ worth of inventory on the market. A balanced market between buyers and sellers is when there is six months’ worth of inventory. A seller’s market is when the supply of inventory is less than 5 months’ worth. Inventory continues to be low. The state’s inventory of homes and condos for sale in August was 2.2 months’ worth of supply. Macomb County’s inventory had a 1.5-month supply and Oakland County’s inventory had a 1.9-month supply. There are very few changes. As you can see, we are still far from a buyer’s market by definition.
Steve Meyers is a Realtor/Realtor with RE/MAX Metropolitan in Shelby Twp. He is also a member of the RE/MAX Hall of Fame. If you have any questions, please contact us at 586-997-5480 or Steve@MeyersRealtor.com. You can also visit his website at his AnswersToRealEstateQuestions.com.