The "Kinda Pending" Home

As of July 1, there were 1,328 residential homes for sale in the communities covered in this Lakes Region real estate market report. The average asking price for those listings was $503,419 and the median price point was $259,900. These numbers are down a bit from last July 1 when there were 1,389 listings on the market at an average asking price $525,250. The current inventory level still represents an 18 month supply of homes to sell which is considerable, but it is far better than the 23 months supply we had last July. Hopefully, we will have a good summer sales season and whittle the available inventory down to more acceptable levels.

Of the 1,328 listings available as of July 1, 82 of these are in what is referred to as “contingency” status. When a property is put in a “contingency” status it means that the property is under contract with some conditions that need to be cleared before it is changed to pending. You know, the house is “kinda pending”, but not all the way. There is a good possibility the deal will close, but there is also a possibility that it won’t.



Just about every offer is contingent upon those except some cash deals, so these probably shouldn’t really be contingencies. They never were until recently. It could be that the agent has received an offer on a home that is a short sale and they are waiting for the lender to approve the transaction. It could also be that an offer has been accepted on a bank owned property and that they are waiting for the purchase and sale agreement to be finalized. In some cases the buyer needs to find out about certain zoning issues that would affect his ability to buy the property for the use intended. Or a listing is pending contingent upon the stars aligning just so.

Another big contingency is that the buyer of the property needs to sell his own property before he can purchase the new one. In this case there usually is another clause added to the purchase and sale to allow the seller of the property to accept another offer if the first buyer cannot complete the transaction in a specific time period. This is what we call a “kick-out” clause and the time frame usually, but not always, is 72 hrs. Obviously, not many buyers find someone to commit to buying their home in 72 hrs and they are kicked out of the deal so to speak. But sometimes the buyer can get a bridge loan or take some other action that will satisfy the seller to ensure that they will purchase the home. If they can't, buyer #2 gets the home.

We often get calls from prospective buyers that want to see a home that is in this contingency status. They usually don’t know about the contingency because many websites just don’t denote it. Many sites just show these listings as being current while other do show that they are “under agreement” or in ”contingency." We can quickly check to see what the contingencies are. If there is a 72 hour kick out clause or a notation that the seller is taking back up offers, it might just be worth the time to go out and look at the property and possibly step into first position if the buyer likes the home.

So that’s the scoop on this “kinda pending" status. Like the term “kick out” clause, I think “kinda pending” is much more descriptive than “contingency,” don’t you? Maybe I can get them to change that down at the MLS…



Data was compiled as of 7/1/12 using the Northern New England Real Estate MLS System.