Is location still the top priority? Should you revamp your home to cater to your preferences or to boost its resale potential? Are entry-level homes still popular? We’re brimming with questions about the continuously evolving real estate landscape. In our “Ask an Agent” series, we’ve teamed up with experts from Better Homes and Gardens Real Estate to delve into your most pressing inquiries about locating, purchasing, and selling a property.
It may come as a shock to some, but a significant number of individuals purchase or sell homes to those they already know. Whether it’s a friend-to-friend transaction or a family “gift,” these home acquisitions introduce their own set of complexities. The most difficult part can be preserving a robust and stable relationship during the occasionally trying process. Discover what a real estate agent has to say about this kind of buying and selling arrangement before you dive in yourself.
For this edition of Ask an Agent, we chatted with Kevin Clark from Better Homes & Gardens Real Estate Dream Partners to uncover the intricacies of buying or selling a home to a friend or family member.
Kevin Clark is a broker and the owner of Better Homes & Gardens Real Estate Dream Partners, based in Janesville, Wisconsin.
When selling a home to someone you’re acquainted with, particularly someone quite close to you, your primary risk is that they might hold you accountable for unforeseen issues that arise after the sale. If something goes awry with the house shortly after the sale, the buyers may suspect that you were aware of the problem and chose to sell it to them without revealing it. To avoid this, ensure that there’s a foundation of trust and leniency with your friend or family member. Lacking this can lead to trouble in close relationships.
If I were a homeowner selling to someone I knew, I’d express, “I’m sharing everything I’m aware of. And if I knew more, I would inform you, but I will admit there’s a chance something could go awry, perhaps in the first year. I’m not sure what it is; if I did, I’d tell you.” This approach would prevent them from blaming me if my concerns turn out to be correct, which I sincerely hope they won’t.
An inspector, of course, would be advantageous for both the seller and buyer. A thorough inspection would also aid in the legal aspects. To add an extra layer of security, I believe home warranties can be extremely helpful in such transactions and can also ease some of the tension. As a homeowner, you might consider offering to cover the cost of a home warranty for the first year, then inform the seller that they are welcome to renew it independently thereafter. Such a gesture can provide reassurance in this unusual kind of sale.
This interview has been edited for brevity and clarity.
