Beware of offers to buy your home

My home isn’t for sale, but a couple left a letter in my mailbox that included an offer to buy my place. Are they allowed to do that?

With it currently being a hot sellers’ market in many parts of the province, there are some homebuyers who are feeling frustrated by the competition and are using creative ways to find a home.

That includes writing personalized letters to homeowners, sometimes with an offer attached, to see if they may be interested in selling their home.

It makes for an interesting story to share around the dinner table for the homeowner, and sometimes this approach might be well-timed for someone who is already planning a move.

If you live in a particularly desirable neighbourhood where few homes come up for sale, you may see more than your fair share of these types of letters or offers. There are no rules stopping prospective buyers, or their representatives, from leaving a letter in your mailbox. If you would prefer not to receive them, consider posting a “no solicitations” sign at your door.

When you’re on the receiving end of such an offer, and it’s something you’re contemplating, it’s important to get informed just like in any other real estate transaction. The prospect of selling your home without having to get it cleaned up, staged or ready for an open house might be appealing. But, you’ll want to understand any trade-offs that may be involved.

First, you’ll want to know whether the buyer is being represented by a real estate professional. If so, keep in mind that the salesperson or broker will be working on behalf of the buyer to represent their best interests. In this case, you may want to look into hiring a real estate professional. You may find their guidance helpful for services such as establishing market value for your home and negotiating with the buyer. And, as you may remember from my column last week, the services you receive from a real estate professional can vary based on your needs, and the commission or fees payable can vary based on the level of service being provided. Before hiring a real estate professional, you’ll want to be sure that you are comfortable with the services that will be provided and the commission or fees you’ll need to pay. It’s also a smart idea to involve your real estate lawyer early in the process to ensure all the details have been considered and are properly documented.

Next, you’ll want to go through the details of the offer to see whether it meets your needs and expectations. Is the offer price in-line with current comparables in your neighbourhood? How much of a deposit is the buyer offering? When will the deposit be provided and where will it be kept until closing? When does the buyer want to move in? Does that give you enough time to find a new place to live?

And, you’ll want to consider the biggest trade-off of all. While selling your home “off market” comes with advantages, there is also one disadvantage you can’t disregard. Without being available to other prospective buyers, you won’t know if your home could have sold for more money or with more favourable terms.

Receiving an unsolicited offer on your home can be exciting, but you’ll need to do your due diligence to ensure it’s as good as it seems. You’ll want to keep a cool head and work through all of this information before deciding whether the offer is one you should accept. Joseph Richer is registrar of the Real Estate Council of Ontario (RECO). He oversees and enforces all rules governing real estate professionals in Ontario. Email questions to askjoe@reco.on.ca. Find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at youtube.com/RECOhelps.