Watch for the February pending sales reports to come out – and keep one thing in mind that may influence how these pending sales ‘read’ – and this goes for statistics in March as well. In January, the Southwest MLS had a policy change which required that when a buyer and seller execute a purchase agreement on a property which is subject to a short sale (and needs the bank’s approval) the property MUST go into a Pending status. In the past, the customary trend by some real estate associates was to keep the property in Active status, and disclose to other Realtors that there was an offer already being looked at by the bank but to submit ‘back up’ offers. In mid-January the new rule requiring that these properties go into Pending status upon the execution of a purchase agreement by a buyer and seller effectively moved many of these properties that were being shown as ‘Active’ into this new Pending status. The reasons for this were many, but the most important reason is that the bank’s approval is only a contingency, and the seller and buyer have come to terms on a sale with a contingency with a third party approval. So, legally, this is an accepted purchase agreement. Most real estate purchase agreements are contingent on something, i.e. approval from the buyer’s lender, inspections, disclosures, etc. The bank’s approval on a short sale is just one more contingency. These short sale properties that are Pending, are just like any other – an offer can be written to fall into place should the first buyer’s offer not proceed to closing. These properties are also not shown to the public on public MLS search websites. Should you have any questions regarding this new rule change, or any other questions regarding real estate, please don’t hesitate to contact us at any time. We are here to help!
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