Renegotiate buying price after corona-virus

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Renegotiate buying price after corona-virus

Milind Shastri
Investor · Allen, TX · Member since 2016 · 104 posts · 37 votes

Has anyone renegotiated the purchase price of a property (being bought through a whole-seller)? 

The deal was entered before the COVID-19 situation, but considering the sudden change of market conditions, it now seems like there is good reason to believe that the house prices will go down, see a few articles: 
article 1
article 2
article 3

Does anyone have any insights about going about renegotiating the purchase price a few days before closing?

Thanks.

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Justin Tahilramani
Rental Property Investor · Fayetteville, NC · Member since 2014 · 884 posts · 670 votes
6y

You can try, but I doubt a wholesaler is going to be moved by your plea. They will likely just take your deposit and sell it to someone else. 

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  • Justin Tahilramani
    Rental Property Investor · Fayetteville, NC · Member since 2014 · 884 posts · 670 votes
    6y

    You can try, but I doubt a wholesaler is going to be moved by your plea. They will likely just take your deposit and sell it to someone else. 

    2Reply
  • Milind Shastri
    OP
    Investor · Allen, TX · Member since 2016 · 104 posts · 37 votes
    6y
    Originally posted by @Justin Tahilramani:

    You can try, but I doubt a wholesaler is going to be moved by your plea. They will likely just take your deposit and sell it to someone else. 

    True, but my guess is that he's not going to be able to sell it to someone else either without a decent price drop. So, there's a sweet spot ($) I'm looking at that can work for both. Assuming he agrees, any ideas on the process?

    1Reply
  • Abel CurielBusiness Member
    Real Estate Agent · Queens, NY · Member since 2016 · 2k+ posts · 1k+ votes
    6y
    Originally posted by @Milind Shastri:

    Has anyone renegotiated the purchase price of a property (being bought through a whole-seller)? 

    The deal was entered before the COVID-19 situation, but considering the sudden change of market conditions, it now seems like there is good reason to believe that the house prices will go down, see a few articles: 
    article 1
    article 2
    article 3

    Does anyone have any insights about going about renegotiating the purchase price a few days before closing?

    Thanks.

    Hello Milind and thanks for sharing these articles!

    Being that you're a few days away from closing, it might be a bit too late but its always worth a shot.

    I'd recommend trying to negotiate some kind of credit from the seller. i.e. seller credit to go towards closing costs. 

    Any reduction in the actual purchase price may mean that the current contract needs to be amended. With that said, a credit at closing from the seller might be the best option. 

    Best of luck to you on this deal!

    Abel

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  • Milind Shastri
    OP
    Investor · Allen, TX · Member since 2016 · 104 posts · 37 votes
    6y
    Originally posted by @Abel Curiel:

     Hello Abel, negotiating a line of credit is a good suggestion. Also thanks for the wishes :) 

    0Reply
  • Will G.
    Rental Property Investor · Maryville, TN · Member since 2009 · 529 posts · 414 votes
    6y

    TRY! your risk profile has changed substantially!

    0Reply
  • Chrissa Carlson
    Flipper/Rehabber · Baltimore, MD · Member since 2019 · 16 posts · 11 votes
    6y

    Hi Molind, we are in the same situation except we’re buying direct from the seller (off market). Went under contract with a five day contingency two and a half weeks ago, the sh*t hit the fan the day after the contingency period ended and we confirmed we were moving forward. We’re going back to the seller to see if she’d seller finance a portion of it, give her about a third of the contract purchase price at closing with an agreement that when we sell we pay off hard money and reimburse our carry costs, keep 10% of sold price as profit, and she gets the rest. If we’re able to sell at the arv we used in our analysis she’d walk with the original contract sales price in her pocket and if we have to sell lower (HIGHLY likely) we’d share the burden in our take home. The outcomes of all of this on prices 4-6 months from now are completely unknown and could be devastating, I could envision not only not making our projected profit but losing a ton. We are hoping she’ll share that risk as she wants to get the house sold ASAP and I think she’s gonna have a hard time getting someone else to take it in the short term. Everyone is in tight spots right now!!! I’ll let you know how it goes and good luck getting your price down!

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