NAR Identifies #1 Real Estate Deal Killer
Real Estate Deal Killing Index
Every quarter, NAR conducts a flash survey and examines local market reports to calculate its Deal Killing Index. The Deal Killing Index places a value from 0 to 1 on common deal killers to establish the danger that it poses to a Realtors deal. The leader of the pack is labeled as the #1 real estate deal killer.
If you’ve been a real estate agent for more than a minute, you’ve probably experienced some of the common deal breakers – low appraisals, first time home buyers buying a new car during the transaction, anything dealing with Rocket Mortgage, and of course the classic, a former spouse maxing out your clients credit cards.
The list of possible pitfalls is unnervingly long. Even longer than the last time you took a weekend off of work.
And then of course, there is the home inspection process. No big deal. Just termite problems, electrical problems, foundation problems, leaking roofs, aluminum wiring, and an 85 page home inspection report between you and that glorious closing table. (btw, don’t use home inspectors who write 85 page reports. That’s just nuts)
It’s not surprising that the number one business expense for most Realtors is booze. In a separate marketing and financial report, the National Association of Realtors (NAR) recommends budgeting about 10 percent of your business budget for marketing and client acquisition, and 85 percent for hootch and carbs.
Even with all these things that can go wrong, there is still one thinger wronger than a zillow estimate in a hot market.
Dad’s are the Number One Real Estate Deal killers
Highlights from the Report
The numbers are out and dads kill more real estate deals than home inspectors, appraisers, and good old fashioned “cold feet” put together. The report was not surprising to most real estate pros, and simply confirmed what they already knew.
Dads received a 1 (the highest rating) on the Deal Killing index. To put that in perspective, electrical issues received a value of (0.1), and anything dealing with Rocket Mortgage received a (0.8.)
Dads eat real estate contracts for breakfast and crap them in the home sellers toilet. Don’t worry, he’s going to test that bathroom fan, and he’ll be sure you to let you know if there isn’t one because it’s code required and the sellers have to put one in. (Not True)
He’ll probably note the low water pressure too…even though its fine.
Nothing invokes as much fear in the real estate industry as Dad on his way to see the potential new home.
Dads, with their throwback t- shirts tucked into their jean shorts, strut around the house with their new balance shoes spotting all the potential issues that the home inspector missed. In fact, one of the best ways to save some money during the due diligence period is to have your dad do all of the diligence. Dads after all, are very diligent.
The report noted that the area dads struggle with the most is cost estimates. Every single thing is $10,000. New roof? $10,000. New HVAC? $10,000. New Water Heater? $10,000.
Red Flags and Real Questions We Have Actually Heard From Deal Killing Dads
- ” The basement smells like asbestos”
- Asbestos, like Radon, does not have a smell. I am not sure what dad was smelling, but it wasn’t asbestos
- “What is the purchase price again? That’s too high. You can still get them to lower it”
- Nope, that is not how it works
- “The house has CPVC which is plastic garbage”
- Yes we know back in your day all homes had copper installed with the blood and sweat of real men. CPVC is fine. I promise
- “Is the electrical 220?”
- um, electrical panels have been “220” for like a hundred years, but here in the USA it’s been 240 since 1967. Even you’re not old enough to have been around for 220.
- “I’m not a structural engineer, but those cracks look like foundation issues”
- No, those are normal settling cracks dad.
- “The closet doors are a little crooked. The seller has to fix that, right?”
- “They don’t build these houses like the older homes I’m used to”
- Correct, there is no knob and tube and wiring, and you don’t need to heat the home with coal
- ” I would just do the inspection myself, but I need your license to submit the report”
- “That crack in the driveway is gonna be a $3000 repair”
- “Ah, we can just go down there and clean that mold with bleach”
- “We’re gonna have to gut this whole kitchen”
This is all of course while banging on all the walls in the house proclaiming that the house seems sturdy.
Of course, they never forget to remind us that they spent a summer framing houses, and they’ve bought 4 homes.
What to do with the data?
Now that you know the #1 real estate deal killer, it is time to take action. Obviously being proactive is better than being reactive. It is in everyones best interests to avoid all deal killers listed on the report, paying close attention to those items with a higher index value.
Hire good inspectors, get a listing inspection, use a local lender, have strong relationships with your vendors, and avoid dads at all costs.
The U.S. Supreme Court unanimously agreed in Hustler v. Falwell, 485 U.S. 46 (1988), that a parody, which no reasonable person expected to be true, was protected free speech.