Legal recourse over below market home sale?

[Anonymous]

This happened to a family member of mine.

Multiple offers on a home and they picked the family who seemed to love the house as is. They said they weren't interested in any major renovations to the house and didn't have the money for it even if they wanted to (the purchase was a stretch for them, supposedly). My family member grew up in the home and was thrilled. Even covered some of their closing costs and left some furniture to help the buyers make their finances work.

Less than a year later, major construction project that turned the house into a McMansion. It's completely unrecognizable now.

My family member was had. I assume these adults told the story they needed to tell to get the house.

[Anonymous]

Anonymous wrote:This happened to a family member of mine.

Multiple offers on a home and they picked the family who seemed to love the house as is. They said they weren't interested in any major renovations to the house and didn't have the money for it even if they wanted to (the purchase was a stretch for them, supposedly). My family member grew up in the home and was thrilled. Even covered some of their closing costs and left some furniture to help the buyers make their finances work.

Less than a year later, major construction project that turned the house into a McMansion. It's completely unrecognizable now.

My family member was had. I assume these adults told the story they needed to tell to get the house.

This is why sellers need to take their emotions out of it and go for the best offer. It's not your relative's home anymore. Quit trying to control what happens after you no longer own it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:As anyone who has completed their 1L property and contract classes will tell you, real estate transactions need to be in writing, and as a general rule of contract law, when there is a written instrument, verbal promises made alongside it are considered null and and void.

This reminds me of 1l. My favorite exception to the statute of frauds was that a signed deposition counted as writing, so if you could get the other party to admit there was an oral contract then you had your written contract. I doubt any practicing lawyer would ever base a case on this, but I remember it popping up on the exam

Case cite please. This seems quite off.

[Anonymous]

Anonymous wrote:This happened to a family member of mine.

Multiple offers on a home and they picked the family who seemed to love the house as is. They said they weren't interested in any major renovations to the house and didn't have the money for it even if they wanted to (the purchase was a stretch for them, supposedly). My family member grew up in the home and was thrilled. Even covered some of their closing costs and left some furniture to help the buyers make their finances work.

Less than a year later, major construction project that turned the house into a McMansion. It's completely unrecognizable now.

My family member was had. I assume these adults told the story they needed to tell to get the house.

It's amazing how entitled your family member feels to dictate what happens to a house after they no longer own it. If they didn't want it to be McMansioned, then they shouldn't have sold it. Simple.

[Anonymous]

Anonymous wrote:

Anonymous wrote:This happened to a family member of mine.

Multiple offers on a home and they picked the family who seemed to love the house as is. They said they weren't interested in any major renovations to the house and didn't have the money for it even if they wanted to (the purchase was a stretch for them, supposedly). My family member grew up in the home and was thrilled. Even covered some of their closing costs and left some furniture to help the buyers make their finances work.

Less than a year later, major construction project that turned the house into a McMansion. It's completely unrecognizable now.

My family member was had. I assume these adults told the story they needed to tell to get the house.

It's amazing how entitled your family member feels to dictate what happens to a house after they no longer own it. If they didn't want it to be McMansioned, then they shouldn't have sold it. Simple.

Or placed a restriction in writing. Like a restrictive covenant.

[Anonymous]

With respect to control over property that one sells: Will vary by state law but must be in writing--like a restrictive covenant.

Imagine living in a home with a great view. You buy the lot directly in front of your home to protect the view. Then you need money, but still want the view.

A restriction in writing that states that only a structure of a certain height can be built of the lot and any structure above a certain height can only be built on a certain part of the lot (which minimizes interference with the view).

Presumably, the buyer will pay a lower price on the lot due to the restrictions.

Everything needs to be in writing.

[Anonymous]

lol this is the plot of the 2011 Muppets movie.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Was there an agent involved here? If an agent priced home 140K under market I'd think you could sue them for negligence (their duty of care would be to price at a market rate and to do the research that requires). But if they opted not to use an agent, it's on them.

The ‘market rate’ is whatever price to which the buyer and seller agree.

"Market rate" is what a lot of buyers and a lot of sellers agree on.
Not only one seller and one seller.

No, the market rate for the house you're selling is the price you and the buyer agree on. There's not some externally determined market price that trumps the actual sale price.

Let’s assume there is a development where the builder is selling identical houses for 800k.
The houses are selling well for him at that price point.
You walked in and you reminded him of his son so he sold you a house for 700k.

In this case clearly you are buying below market rate.

[Anonymous]

Katy Perry is being sued for similar thing (twice)

[Anonymous]

Anonymous wrote:With respect to control over property that one sells: Will vary by state law but must be in writing--like a restrictive covenant.

Imagine living in a home with a great view. You buy the lot directly in front of your home to protect the view. Then you need money, but still want the view.

A restriction in writing that states that only a structure of a certain height can be built of the lot and any structure above a certain height can only be built on a certain part of the lot (which minimizes interference with the view).

Presumably, the buyer will pay a lower price on the lot due to the restrictions.

Everything needs to be in writing.

I actually almost bought a two acres lot in the Hamptons with those restrictions. The prior owner sold to guy to right and guy behind a deed restriction that no house above one story could ever be built. It also had an underground stream in front with another restriction. In the end only 60x100 was buildable on the two acres. Still could have been great.

But selling air rights devalued property.

[Anonymous]

Anonymous wrote:This happened to a family member of mine.

Multiple offers on a home and they picked the family who seemed to love the house as is. They said they weren't interested in any major renovations to the house and didn't have the money for it even if they wanted to (the purchase was a stretch for them, supposedly). My family member grew up in the home and was thrilled. Even covered some of their closing costs and left some furniture to help the buyers make their finances work.

Less than a year later, major construction project that turned the house into a McMansion. It's completely unrecognizable now.

My family member was had. I assume these adults told the story they needed to tell to get the house.

This is why you don't bother listening to the stories.

[Anonymous]

Was there an agent involved here? If an agent priced home 140K under market I'd think you could sue them for negligence.

The term agents use for what you call "negligence" is, "starting a bidding war".

Truthfully OP has a future as a real estate agent. Rather than being ridiculed for making idiotic real estate decisions, as an agent he will be rewarded with undeserved commissions. Admittedly, he will be making other people miserable, rather than just himself. But OP can always take comfort in the fact that his role as an agent is necessary, because those kickbacks aren’t going to collect themselves.

If OP wants to enact revenge of the buyer, he should drop out of high school, get his GED, and become a real estate agent. In the future when the buyer is trying to sell, this is his time to act. Offer to represent him as his agent. Talk to him into wasting time and money on valueless things, like “staging”. Refer him to his crooked financing and contracting co-conspirators. “Start a bidding war” (which is totally not "negligence"). Do essentially nothing important, and fill your time by inventing non-sensical reasons to justify your existence.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Was there an agent involved here? If an agent priced home 140K under market I'd think you could sue them for negligence (their duty of care would be to price at a market rate and to do the research that requires). But if they opted not to use an agent, it's on them.

The ‘market rate’ is whatever price to which the buyer and seller agree.

"Market rate" is what a lot of buyers and a lot of sellers agree on.
Not only one seller and one seller.

No, the market rate for the house you're selling is the price you and the buyer agree on. There's not some externally determined market price that trumps the actual sale price.

Wrong. If a seller sells a $900K house to his granddaughter for $25K, do you think the market rate/value is now $25K?

[Anonymous]

OP here, thanks to everyone for their constructive comments. I knew that there would be little my friend could do about this, but I thought I'd ask. I will answer a few of your questions

Anonymous wrote:Was there an agent involved here?

Not as far as I know. I suggested he hire a realtor or a real estate professional to help him sell the house. He probably didn't want to pay the commission if he could do it himself. Genius move.

Are you certain it went for $125k below value based on its condition?

Yes, because he told me how much he sold it for, and I looked up his property on Zillow which listed the original and the new sales amounts.

[Anonymous]

Anonymous wrote:Verbal contracts or handshake agreements, are legally binding but difficult to prove.
In this case it might not be hard to prove.

Unless, of course, the subject matter of the agreement is covered by the Statute of Frauds. https://www.law.cornell.edu/wex/statute_of_frauds