Generally, I am not a superstitious person. I don’t bury St. Joseph statues in the yards of my listings (there will be a future blog on this), I don’t have a lucky pair of underwear that I wear to listing appointments, and I don’t read the horoscopes of my buyers to figure out if today is the day we’ll find them a house. However, there is one thing in real estate that I am overly superstitious about; “Sale Pending” signs. If there is one kiss of death for a sale that has not met all of its contingencies, it’s the Sale Pending sign.
There are no “rules” agents abide by when hanging the Sale Pending rider on a For Sale sign. They are free to do so at any time once a house has a signed contract. Some agents hang them immediately, typically to proclaim “Look at me! I sold this house in 1 day” or “Look at me! I FINALLY sold this house!” Some agents hang them just a few days before closing, after all of the contingencies (inspection, appraisal, mortgage commitment, clear title, etc.) have been met. And some agents never hang them at all. It’s a matter of personal preference, in most cases.
I am convinced Sale Pending signs are bad luck, particularly if they are hung before all of the contingencies are met. Earlier this year I drove up to a house to meet my buyer for the home inspection and there was the Sale Pending sign, mocking me, blowing in the breeze. My reaction? “Oh crap. Why did they hang that sign already? This is never good…” And it wasn’t. Radon came back off the charts and the deal was dead. No more Sale Pending sign at that house.
Some sellers request that their agent hang the Sale Pending sign as soon as they’ve signed the contract. “We want people to know our house is sold.” As an agent I don’t necessarily want all of the interest in your house to die because if for some reason the deal falls through, I want some people I can go back to that might have interest. You can never be too careful.
Some buyers wonder why the Sale Pending sign isn’t up after their offer is accepted. I explain that there is no rule about if and/or when an agent has to hang the Sale Pending sign. Buyers want to see the sign so that other buyers know the house is off the market. Basically, “stay away from my new house!”
I am not a fan of counting chickens before they hatch, hence you’ll typically never see a Sale Pending sign on one of my listings. Or if you do, we’ve gotten the clear to close and the house will transfer owners in the next day or two. As much as I’d like to proclaim to the world that I’m awesome and helped my client sell a house quickly, I’d rather just quietly go to closing. Because selling the house is truly the end goal, not basking in the glory of some silly sign rider.
Does the seller’s agent “have to” update the MLS listing to reflect a pending sale?
Yes, the seller’s agent should be updating the MLS once a house has a fully signed contract. This is considered “Show” status in the MLS. “Show” status means the house is still available for showings, but lets the broker community know there is an accepted offer on a house.
A house typically remains in “Show” status in the MLS until all of the contingencies have been met. Then it goes to “Deposit” status.
Most agents are very good about changing the status in the MLS. A few are not. If agents don’t follow the MLS rules, they can be fined, but it requires that someone report them.
It should be noted that a house will continue to show up on Realtor.com and all of the other major house search websites until it goes into “Deposit” status. Some people get confused by this because they will call to get information on a house and we’ll tell them it’s under contract. They want to know why it still shows up. It’s simply because all of the contingencies haven’t been met yet, so the seller still wants the agent to be marketing the house incase the deal does not stay together.