Lew Sichelman
Remember the company that was offering homeowners a few thousand dollars in exchange for the promise that if they ever decided to sell their houses – at any time in the next 40 years – they would list it with them?
Not only has the outfit been put out of business, but it has agreed to terminate its Florida contracts with deceived homeowners.
“It took forever, but now after all these years and all this litigation, consumers are finally seeing relief,” attorney Matt Weidner told me.
Weidner was the first to report the ruse to Florida’s attorney general.
The Boca Raton-based company, MV Realty, claimed to have inked thousands of its 40-year listing agreements with owners, who never realized that those contracts essentially became 40-year liens on their properties. If the homeowner listed with another real estate firm, the pact obligated them to pay MV Realty a 3 percent commission – even though it did nothing to earn the fee.
The stipend offered by the firm, anywhere from a few hundred dollars to several thousand, was a godsend to some homeowners who were short on cash. But very few realized what they were getting into. For example, because of the lien, they couldn’t refinance or borrow against their equity.
Anyway, MV has been smacked down by numerous states. And now, a Hillsborough County, Florida judge has ruled the company can no longer enforce its existing agreements in the state. Those pacts must be terminated altogether.
“Unconscionable” is how Circuit Judge Darren Farfante described the contracts. Hopefully, other states will follow Florida’s lead.
Want Top Dollar? Skip Cash Buyers
If you want to sell your house with no muss and no fuss, consider one of the numerous outfits that will buy your place for cash and close within days. But if you want top dollar, stay away from those companies.
Cash buyers typically close within one to two weeks, according to research from Clever Real Estate. But the trade-off is costly: The average cash offer is roughly 70 percent of market value. So if your place is worth, say, $350,000, you’ll get only $245,000 – a major difference.
At the same time, it now takes an average of 85 days on the market for a house to sell to a traditional buyer. And that number is growing.
Clever found that nearly a third of all houses sold in 2024 were purchased for cash.
Would You Trade in Your Condo?
Homebuilders are offering all kinds of sales incentives these days. But a Florida builder is going one step further: offering to take his buyers’ unsold condominium units as down payments for one of his custom houses.
“It’s almost like trading in your car,” Phil Thompson of Coral Reef General Contracting told the TC Palm newspaper. “You hand in your keys, and they hand you new ones. It’s basically the same theory.”
Thompson is taking advantage of the huge inventory of unsold condos in the Fort Pierce-Port St. Lucie market. Some sellers just want to move on, some are finished with difficult condo boards, some can’t handle rising condo fees and still others live in buildings that have been flagged for structural problems.
Whatever the reason, the builder will take those units as a down payment. “I am not concerned about taking a condominium that has some structural issues,” he told the paper. “I’ll take that condo and I’ll either fix it, rent it or resell it.”
Thompson admitted he won’t make money on every deal. “Some of them I may lose a little bit of money,” the builder said. “But in the long run, it is about relieving a bad situation for my buyer.”
Growing Price Disconnect
The disconnect between asking prices and selling prices currently sits around 9 percent – the biggest gap since May 2020, said Redfin. It reports that the typical asking price in March was $469,729, while the selling price was $431,057: a difference of nearly $39,000.
The gap is widening because list-price growth is accelerating while sales-price growth is decelerating. Sellers don’t seem to have realized that the market has shifted to favor buyers; they are basing their prices on comparable sales from the past rather than current demand.
“Buyers and sellers are on different pages,” the Redfin report explained. “Sellers continue to demand last year’s record-high prices, but with mortgage rates still so high, buyers have reached their limit and aren’t budging.”
Tariffs Keep Pinching Construction Materials
The average new single-family home requires $174,155 worth of building materials, and 7.3 percent of those materials are imported, said the National Association of Home Builders. That 7.3 percent – or $12,713 – in imported materials may not seem like much, but American builders and remodelers are already feeling the pinch from the country’s on-again, off-again tariffs.
NAHB said suppliers have already hiked their prices by an average of 5.5 percent on their builder clients, and by 6.9 percent on remodelers, all due to the tariffs – whether they’ve actually been enacted or just anticipated. Some builders have seen their costs jump by as much as 11 percent.
Lew Sichelman has been covering real estate for more than 50 years. He is a regular contributor to numerous shelter magazines and housing and housing-finance industry publications. Readers can contact him at lsichelman@aol.com.
