Whats interesting is that most people set 1.5 mil as their search criteria. To see something that was at 1.4x sell for 1.6x is pretty unusual.

Also to add to the above who mentioned to sell first and have no subject to sale, having subject to finance will potentially put you down further down the list if someone has a cash offer.

It should be unusual, but "affordable" detached inventory in van/bby has literally disappeared and what's been available has been bid up by builders tearing down to rebuild, investors buying to speculate, and upsizers looking to trade in their condo/th. Last year, at this time there were ~6500 active detached listings and right now there is only ~4400...

A 1900s home close to me with 4200 sq ft lot, mortgage helper recently sold for 1.38 but it was closed immediately... Cash offer. It's unfortunate these get snagged so fast by builders. I totally see a young family starting out in these homes but stand no chance against cash offers. Mind you the home looked livable with early 2000 Reno's.

During our deal, we had subject to sale and the seller accepted. We had 2 weeks to sell but had no bites, next thing we knew, they didn't want to extend our time as a builder had offered them cash. Lucky for us, we had a offer on our townhome and forced the buyer to close within 3 days (we gave them 35k off the last comp. Didn't care as we were so emotionally vested to move on.

Of course a cash offer would be king. But if I had to pick between someone with a subject to sale vs a subject to finance, I would take the one with the subject to finance. Less variables to worry about.

I put in an offer on a place in Nordel with a subject to financing. They got higher offers as backup but with a subject to sale. We needed an extension to subject removal and it was fine. Guess they really didn't want a subject to sale.

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No one wants a subject to sell. It's like waiting to sell 2 houses

Imagine if the subject to sell also had a subject to sell. :lol

Inception

So break it. You'll save enough to justify the penalty I suspect.

-Mark

I've never dealt with the situation, but isn't subject to sell kind of subject to finance too? Assuming the offer is based on what the buyer thinks their current place will sell for, if they end up selling for less than they thought could they fall short on their offer?

Exactly. Its almost like subject to financing but for a longer period of time. In the end, it will still be up to the buyer to accept a good offer or if they change their mind on the purchase property, they don't have to accept any offer and have it expire.

I understand why and where you are asking the question, but the two subjects (sell and finance) are not one and the same.

The subject to sale indicates you have equity tied up in an existing mortgage/property. Say the condo you are selling is worth $650,000 on the market (let's assume it's fair market value.) You list it on the market, and it sells, asking price. And let's assume you made a pretty penny off of the property, let's say $250,000 after agent and legal fees etc. You have $250K + whatever money you originally put down as your initial down payment (let's say $50K for sake of argument, I'm not doing math at this time of day) for a total of $300,000 in equity.

Okay, so now you have $300K in cash. That's pretty juicy. But let's say you aim for a house that's asking $2.5M and you and your spouse have a combined household income of only $140,000. The bank is going to want to see a much bigger down payment, and determine your creditworthiness, and ability to meet your monthly mortgage payments, and so forth. The bank is going to want to protect themselves by ensuring you can pay them back, and that this $2.5M house is really worth $2.5M on the market and for years to come. That and they want to know that the foundation isn't going to sink the moment you step foot on the front door, or the roof isn't going to collapse the next snow day etc. The list goes on, but given the scenario I just shared, the bank is going to tell you to fuck right off and laugh you out the door. If you don't put a subject to financing in there, you make an offer on the house of $2.5M, you better have a rich uncle to lend you that money. Not many banks are willing to let you have two mortgages at once without a very good reason, hence the subject to finance.

It's not really the same as normal subject to finance so that's probably a bad term to use but the buyer is banking on selling their current place for a certain value. Maybe I'm thinking of a situation that doesn't exist, but hopefully it makes more sense with numbers?

Say the buyers are offering $1M for a house, subject to the sale of their current condo. They're expecting to sell the condo for $500k, and expecting to land at $250k in total equity after fees etc. They're approved for a mortgage for the other $750k.

Except they don't get the $500k they expect for the condo, they only get $450k for whatever reason, so now when you add everything up they're at $950k total/$50k short. Now they're back to needing to get another $50k worth of financing. Now what happens?

If they can't obtain another 50k in financing it's best that they don't remove subjects on the property that they would like to buy so they can just walk away and keep their deposit (assuming their real estate agent put in the correct clause in the purchase contract). This is why subject to sale clauses (easily 1-2 months in length) are not strong offers and will most likely be skipped unless A) it's a buyers market or B) the offer is significantly higher than every other offer.

Cashing out and renting is a PITA but the leverage it gets you, is worth the sacrifice.

Agreed to both posts above. It really depends on market dynamics.

100%, if you remember late last year I accepted one of these offers because I was at the point of pulling it off the market anyway because I was done with showings and they were offering close to our ask.

I think it took them 3 months to sell their house? At the end of it they were like we have an offer on our place but it's less then expected so are you willing to drop the sale price of yours? I was like after 3 months? Nope, find another house we out. They came back and removed subjects.

Our issue was buying because by the time ours sold it was very much a buyers market and it was late fall so there wasn't much inventory. We eventually found a house and we really like it by I still feel like I overpaid but what can you do?

The worst thing about selling was the showings with two dogs. If I ever sell again it will be under the presumption to my Realtor that you get a two hour window once a week if anyone wants to see the house they can come in that window if they can't make that window it's probably not the house for them. People would always want to come during the week at dinner time, they'd show up late or sometimes they'd pull a no show pissed me off so bad.

Aside from E Van, seems like there's some decent inventory under 1.5 range in BBY. But I guess you cant compare apples to oranges.

Last time I sold a car, I had 17 appointments in a weekend and only 4 showed up (only 2 on time). "Family emergency" was a common excuse :rukidding:

People have zero respect these days.

For home insurance (detached) is getting a monitored alarm system worth the cost savings vs a local alarm system?

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100%, I've never missed an appointment with a total no show at the very least I'd cancel with some notice.

I think if I was selling a vehicle I'd do the same thing as well, set up a viewing window on a certain day this way you're only inconvenienced a couple hours once a week, so many people are such flakes.

Do you yave a landline? When I looked into it a few years ago it was if you have an existing landline, once you add the cost of a landline or the cellular setup it wasn't worth it

We do. We'll probably port it over to the new place. But I'm leaning on not keeping the landline.

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BTW rates dropped again on Monday (20th) for TD and HSBC. Im sure other banks dropped too.

Most monitored home security systems now operate with a SIM card built in with a backup over your wifi.

Generally speaking the reduction in hone insurance will only cover the basic home security packages, anything additional like cameras etc will be paid out of pocket.

Banks could never match what a monoline lender is offering us at 1.89 for 5 years fixed. Just waiting till Sept 8 when our 120 days till closing comes into effect for us to take this offer, unless rates go down even lower.