With the recent market situation in McCall, meaning fewer homes on the market and more buyers, advice has been abounding about how to close the deal, including writing a letter to the sellers telling them how much you love the home and why you should be the ones to live in it. All too often buyers get emotionally wrapped up in the purchase of their “dream home” and feel that writing a letter to the seller explaining how much they love the home and how they plan to (fill in the blank: raise a family, watch the grand kids play, live out their dreams etc.) is the best way to get their offer accepted.
While all this is true and nice, most likely what is happening is that the buyer is giving up all of their cards, which in turn can hurt their negotiating position. When the seller knows how much the buyer must have the house it is far more likely that they will be less forgiving and flexible when it comes time to negotiate. In the end, writing the letter can hurt you more often then not. If you feel that you absolutely need to write the letter, consider doing it after the sale has been completed. Then you can thank the seller for the home and let them know how much you love it.
The same works in reverse for sellers who feel they have to write a letter and leave it on the counter for showings or email it to the selling agent. Most of the time these “love letters” depict how much they loved the home, how they raised their children/grand children but now that ____________ happened or now that _____________ got sick they have to sell the home to “down size, move closer to a hospital, move closer to children so they can help, etc etc etc.” All this is doing is giving up the seller’s cards so that when its time to negotiate they have already lost some negotiating power.
Furthermore, according to Christine Smith with the National Association of Realtor’s, buyers’ letters could pose problems with the Fair Housing Act, which makes it illegal to refuse to sell or rent to a prospective tenant based on their race, religion, color, sex, national origin, family status, or disability. Consider the letter from a married couple mentioning that their kids really love the house, which is close to their church. Say the letter moves the seller to reject a higher offer from an unmarried buyer of a different religion—this might turn into a legal problem. Letters can be subpoenaed and used as evidence, even if there was no discriminatory intent. Sellers, buyer agents, and listing agents could all be found in violation of fair housing laws.
The lesson here is to keep your cards close and let the negotiating take place without the emotional element.
