Seller says "I don't want people going through there or I would have listed it."

17 Replies

With all the recent posts about wholesalers, I thought I might ask what I should do on this one.

My seller inherited a house that is currently occupied by a family member. He wants to sell to me but is OK if I assign it later. He just doesn't want people going through the house. I understand his concern.

What can I do up front so that anyone I might want to assign to won't necessarily need to peek inside to make a decision?

Here is what I have so far:

  • Inspection by a licensed inspector
  • Engineer report on the foundation (It's Texas and the house was built in the 50's)
  • Lot's of pictures
  • Room dimensions
  • Should I get a GC in there to do a bid?

Thoughts?

Let the owner know that you and your funding partners have to do a walk through the home before your able to make a final decision, or see if there is a time where the tenant isn't going to be home and you could just meet the homeowner there with your buyers. 

Also, take some good videos of the home, the outside of the home and of the neighborhood. I've built good relationships with my buyers, and now they only need to see a video and the numbers to make a decision. 

I had a similar situation but convinced the seller if he wanted to sell the house, he would need people to look at it.  Interested to see other ideas.

Originally posted by @Avery Gilmer :

Let the owner know that you and your funding partners have to do a walk through the home before your able to make a final decision, or see if there is a time where the tenant isn't going to be home and you could just meet the homeowner there with your buyers. 

Also, take some good videos of the home, the outside of the home and of the neighborhood. I've built good relationships with my buyers, and now they only need to see a video and the numbers to make a decision. 

 Do not do this unless you actually have funding partners.  Prospective buyers are not funding partners, and saying you have funding partners when you do not is a lie.

Thanks everyone. I will definitely do the video.

I've already seen the house once and I told him I'll need to go over again which he is fine with. He just doesn't want people over there everyday for 1 month.

So basically he hired you to broker the house and doesn't want you to show it?

No company avatar mediumJohn Thedford, John Thedford | 239‑200‑5600 | http://www.capehomebuyers.com

From Texas Real Estate Commission:
Brokers and salespersons often use unlicensed personnel for assistance in conducting their real estate brokerage activities. Such unlicensed persons, sometimes referred to as administrative assistants, can be of great help to a busy agent. However, care must be taken to ensure that the unlicensed person does not conduct any of the activities for which real estate licensure is required. This article defines some of those activities which may and may not be legally conducted by unlicensed persons.

Sections 1101.351(a) and 1101.758 of The Real Estate License Act establish that it is a crime for an unlicensed person to engage in activity for which a real estate license is required. The broker or salesperson that employs an unlicensed person might be criminally charged for the crime as well. In addition, TREC may take disciplinary action against a broker or salesperson that pays or associates with an unlicensed person who engages in activities that require a real estate license. Authority for this disciplinary action is set out in Sections 1101.652(b)(11) and (26) of the License Act. For these reasons, it is important to distinguish between those activities that do and those that do not require a real estate license. Section 1101.002(1)(A) of the License Act sets forth a list of activities that require licensure and are worthy of a close reading.

Preliminarily, the real estate brokerage activities must be "for another" person or entity. This means that persons who are buying, selling or leasing their own property do not need a license; they are acting for themselves and not for another person. The activities must also be for a fee or something of value, or with the intention of collecting a fee or something of value. This means, for example, that an unlicensed person whose neighbor has been transferred out of state may solicit tenants and negotiate a lease on behalf of the neighbor so long as the person does not receive or expect to receive anything of value for helping.

The list of activities requiring licensure may be summarized and placed in two categories (but remember, this is a summary only and not all inclusive). First, and as used in the paragraph above, are those activities in which a person directly helps another buy, sell, or lease real property. These activities, such as negotiating a listing agreement with a property owner, spending the afternoon with a couple showing houses for sale, or negotiating a contract to buy or lease real property, obviously require licensure. These "direct" activities are seldom the subject of debate or controversy.

The second category of activities might be referred to as "indirect" activities and are more troublesome. Section 1101.002(1)(A)(viii) of the License Act requires licensure of those persons who procure or assist in procuring prospects to buy, sell, or lease property. Section 1101.002(1)(A)(ix) of the License Act requires licensure of those persons who procure or assist in procuring properties to be bought, sold, or leased. If the words "assist in" were read broadly enough, virtually everyone working in a real estate office would need a license. Common sense dictates, however, that many activities can be legally conducted in a real estate brokerage office that do not require licensure. There may sometimes exist only a thin line between those activities that require licensure and those that do not. The foregoing general rules and the following discussion of factual situations may help licensees accurately draw this line.

Q: May an unlicensed person, identified as such, make calls to determine whether a person is interested in buying or selling property, or has property they wish to sell, and if so, make an appointment for a licensed agent to talk to them?

A: No. Often referred to as "telemarketing," any such activities conducted in Texas must be conducted by a licensee. In Tex. Atty. Gen. Op. H-1271 (1978), the attorney general concluded that a license was required. Also, Commission Rule 535.4(e) makes it clear that all solicitation work must be conducted by licensees.

Q: May an unlicensed person sit in on an open house?

A: Yes, but care must be taken that the unlicensed person does not "show" the house to prospective purchasers. Commission Rule 535.4(c) makes clear that only licensed agents are allowed to show properties. On the other hand, Commission Rule 535.5(h) also specifically allows a broker to hire an unlicensed person to serve as a "host or hostess" at homes offered for sale by the broker. The Rules do not define these terms, and such a hostess should be limited to welcoming the visitors. The hostess may register the guests and refer inquiries to a licensee. Clearly, the hostess must not point out features of the home or neighborhood to visitors; however, as is the case with secretaries and receptionists discussed below, the hostess may distribute a flyer or brochure that describes the property.


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No company avatar mediumJohn Thedford, John Thedford | 239‑200‑5600 | http://www.capehomebuyers.com

Originally posted by @John Thedford :

So basically he hired you to broker the house and doesn't want you to show it?

 Where in this thread is that implied?

@John Thedford

 He wants me to buy it. He's OK with me assigning it but would prefer that I buy it outright. I told him that I'd like to buy it outright but I might be in over my head with all the repairs that are necessary. I've been upfront since the beginning that I have multiple exit strategies including assigning the contract. He is a commercial broker in another state and started his career the same way I'm starting mine so he understands.

@Guy Gimenez

 Would you want to see an engineer's report for the foundation? It is pier and beam. What about a GC quote? I would assume that this is useless sense a buyer will have his own contractor to work with.

@Mindy Jensen @Guy Jimenez Good suggestions. He's got to know you can't sell what you can't show ... unless it's pennies on the dollar. 

When I have a house I schedule "showings/tours for 1 day a week (typically Sat) and get as many people there at the same time as possible. Creates a little competition among potential buyers. 

Video is a good idea. Get a vid, leave out the street address. Make your video from still shots of the the house. Slide show style. Fade in fade out with a little background music (much better than shaky handy cam with someone talking through the vid). Check readytogovideo.com for example vid. Get good pics and my daughter will make a vid for you if you don't want to do it yourself.  

Originally posted by @Michael Hart :

@Mindy Jensen @Guy Jimenez Good suggestions. He's got to know you can't sell what you can't show ... unless it's pennies on the dollar. 

When I have a house I schedule "showings/tours for 1 day a week (typically Sat) and get as many people there at the same time as possible. Creates a little competition among potential buyers. 

Video is a good idea. Get a vid, leave out the street address. Make your video from still shots of the the house. Slide show style. Fade in fade out with a little background music (much better than shaky handy cam with someone talking through the vid). Check readytogovideo.com for example vid. Get good pics and my daughter will make a vid for you if you don't want to do it yourself.  

 Great ideas ... This is a great way to go about it.

@Tony Hernandez

1.  Get it under contract so you have something to assign. 

2.  Your job is not to determine what the costs of repairs and updates will be...that is the job of the buyer. Just some basics (ie paint, carpet, siding, moderate foundation deflections, etc.)

3.  I will always do my own investigations into the property and not depend on the assignor's reports and inspections...I have no idea what their relationship may be with those producing the reports.

Guy Gimenez, Buying Texas Today | [email protected] | (512) 270‑7279 | http://www.BuyingTexasToday.com

Originally posted by @Tony Hernandez :

With all the recent posts about wholesalers, I thought I might ask what I should do on this one.

My seller inherited a house that is currently occupied by a family member. He wants to sell to me but is OK if I assign it later. He just doesn't want people going through the house. I understand his concern.

What can I do up front so that anyone I might want to assign to won't necessarily need to peek inside to make a decision?

Here is what I have so far:

  • Inspection by a licensed inspector
  • Engineer report on the foundation (It's Texas and the house was built in the 50's)
  • Lot's of pictures
  • Room dimensions
  • Should I get a GC in there to do a bid?

Thoughts?

Here's a wild idea:

Buy and close on the property yourself then re-sell it. 

Crazy, huh?

My first thoughts are that it is occupied so that you can't inspect it. Asbestos, lead paint, ancient wirings and electrical box, there is plenty that would disqualify it for a mortgage. On plan b renting it could be non insurable liability.  Also, do you have to evict a hostile relative? It doesn't add up to me.

@Rick H. . I should expect that anyone I might assign the contract to will want to do the same. Since my plan A is to do the flip myself, I will be doing my own inspections and estimates. At least I'll know what things someone else will want to do if I move to plan B and can set the Seller's expectations.