Florida Inspection Bluff vs. Backup Offers

Inspired by this SliceOfFlorida.com Blog Post

Episode Overview

In this episode of the Real Estate Agent Man Podcast, hosts Ian and Angela explore the "Florida Inspection Bluff," a buyer strategy in Florida real estate that leverages the inspection period to renegotiate prices. They break down how it works, signs to watch for, and why it can fail, with a real-world case study. A must-listen for anyone navigating real estate negotiations.

Key Topics and Timestamps

• [0:00] Introduction
  Steve welcomes listeners from over 1000 cities across 74 countries, introducing the episode’s focus on the Florida Inspection Bluff, a common buyer tactic.
• [0:34] What is the Florida Inspection Bluff?
  Ian and Angela introduce the concept, describing it as a high-stakes negotiation tactic where buyers use inspections to demand price reductions.
• [1:02] Deep Dive into the Strategy
  The hosts explain how buyers offer a higher price to secure a property, then use the inspection report as leverage to negotiate a lower price.
• [2:13] Role of the “As-Is” Contract
  Discussion of Florida’s “as-is” contract, which includes a broad inspection contingency allowing buyers to back out for any reason and recover their earnest money deposit (e.g., “I don’t like the mailbox” [3:19]).
• [3:25] Red Flags for Sellers
  Key signs of the bluff include buyers focusing on the age of big-ticket items (e.g., roof, AC) after inspections, despite these details often being available upfront [3:35].
• [4:30] Case Study: Brad and Shelley
  The hosts introduce a case study of Brad and Shelley, house hunting in Venice, Florida, for a specific property under $400,000 [4:38]. They detail the couple’s tactic of securing two properties under contract simultaneously [5:58].
• [6:19] The Bluff in Action
  Brad and Shelley’s enthusiastic inspection performance (e.g., measuring furniture, getting unnecessary pool cage quotes) is described, followed by their sudden demand for a price reduction or cancellation that night [8:20].
• [8:49] Why the Bluff Failed
  The sellers’ preparedness with a signed backup offer allowed them to reject the ultimatum and move forward with the backup buyers instantly [9:04].
• [10:01] Key Takeaways
  Lessons for buyers (know the risks), sellers (secure backup offers), and anyone interested in negotiation dynamics. The bluff relies on the “as-is” contract loophole, but preparation can neutralize it [10:12].
• [11:40] Closing and Call to Action
  Steve encourages listeners to visit sliceofflorida.com and subscribe for more real estate insights.

Additional Information

• Podcast Details: The Real Estate Agent Man Podcast offers coaching for Florida buyers and sellers in Sarasota, Charlotte, and Manatee counties. Steve interviews agents nationwide to connect customers with trusted professionals.
• Call to Action: Subscribe and leave a review. Visit sliceofflorida.com for listings and resources.
• Contact: Reach Steve Martin at Slice of Florida Realty for personalized guidance.

Source Material

Based on Failed Buyer Tactic: The Florida Inspection Bluff, featuring the Brad and Shelley case study.

Transcribed by otter.ai

Steve Martin Smith is a Licensed Florida Real Estate Broker and the owner of Slice of Florida Realty in Sarasota County Florida.

Transcript

Speaker 1  0:00  
Steve, you've just joined listeners in more than 1000 cities across 74 countries and territories to discover secrets of Florida real estate that should not be secrets Real Estate brought to you by slice of Florida Realty. Today's episode could definitely be hashtag True Story guy as Ian and Angela discuss this common practice that we just witnessed again this week.

Speaker 2  0:34  
Okay, so have you ever been in one of those really high stakes negotiations, like maybe buying or selling a house, Oh, yeah. And you just get that feeling, you know, that that the other side isn't quite playing fair. Maybe they've got some trick up their sleeve.

Speaker 3  0:49  
Definitely, that feeling is, well, it's pretty common, honestly, often, because there is something going on, some kind of calculated move, right? And today, we're actually going to dig into one specific buyer's strategy. We

Speaker 2  1:02  
are doing a deep dive today into something called the Florida inspection bluff. And our mission really is to unpack exactly how this thing works. What are the signs you know that you should look for, and, importantly, why? Sometimes it just completely blows up in the buyer's face. Yeah,

Speaker 3  1:18  
it can backfire spectacularly. And we've got some great source material for this titled failed buyer tactic, the Florida inspection bluff. Okay, it gives a really detailed look at the strategy, and crucially, a real world case study that shows it in action really brings it to life. Perfect.

Speaker 2  1:35  
So this Florida inspection bluff, how does it actually start are buyers like intentionally offering more than they want to pay

Speaker 3  1:46  
exactly. That's the core of it. The strategy basically involves a buyer getting a property under contract, often at a higher price than they truly intend to end up paying. The main goal right then isn't actually buying at that price. It's simpler, yeah, just get the property off the market, control

Speaker 2  2:04  
it, take it off the board, basically, pretty much, and then once they've got it locked down, that's when the inspection period comes into play. Yeah? So it's not just about, you know, finding leaky pipes or

Speaker 3  2:13  
whatever. No, not entirely. The inspection report becomes, well, a tool, a bargaining chip. It gets used, not just for genuine issues, but as leverage, leverage for what, demanding price cuts, precisely, demanding significant reductions, or threatening to just walk away from the whole thing if they don't get them. Wow. And the real power behind this, especially in Florida, comes from a specific contract. It's called the as is contract, for sale and

Speaker 2  2:37  
purchase. The as is contract, okay, that sounds important. What's special about that

Speaker 3  2:41  
is absolutely key, because it usually includes a clause, a contingency period, often called the inspection period, where the buyer can back out for any reason, any reason at all, any reason, and still get their earnest money deposit back. That's the, you know, the good faith money they put down right the deposit. Normally you'd lose that if you just changed your mind without a valid reason tied to the contract contingencies. But this, as is contract with that broad inspection clause, it basically creates a loophole, a big one, huge. A buyer could literally say, I've decided I don't like the mailbox and still potentially get their deposit back during that

Speaker 2  3:19  
period. That is quite the safety net for a buyer, isn't it? It really is. Gives

Unknown Speaker  3:23  
them immense power. So okay, for

Speaker 2  3:25  
sellers then, or maybe even other buyers who are competing. What are the signs? How can you tell if someone might be setting up this kind of bluff?

Speaker 3  3:35  
Well, what is the biggest red flags? Something we see quite often is when buyers start focusing on the age of the big ticket items, like,

Unknown Speaker  3:43  
what roof? Yeah, AC,

Speaker 3  3:44  
exactly the roof, the air conditioning units, maybe the water heater. They use the age of these things as a reason to demand concessions after the inspection.

Speaker 2  3:54  
But isn't that stuff usually like known upfront or easy to find out? That's the

Speaker 3  3:59  
point. These details are often readily available before you even make an offer. You know the age of the house. You can ask about the roof's age. It's often in the listing details or easy for an agent to find out, right? So if a buyer gets under contract and then acts shocked or concerned about the age of a 15 year old AC unit, it suggests it might be less of a surprise discovery and more of a well, a planned move, a ploy. Gotcha like complain about the mileage on a used car after you agreed to buy it. Exactly that kind of thing. The information was there all along.

Speaker 2  4:30  
Okay, that makes sense. And this is where our case study comes in, right? Because it really shows this whole dynamic playing out. Let's talk about Brad and Shelley.

Speaker 3  4:38  
Yes, Brad and Shelley, they were house hunting down in Venice, Florida, and they had a very specific wish list. Oh, yeah. What were they after? They needed a three bedroom, two bathroom place. Okay, pretty standard, but also a two car barrage, a pool and a privacy fenced yard. Plus they wanted updated kitchen and baths. Okay, that's getting specific. And the kicker all for. $400,000 or less

Unknown Speaker  5:03  
in Venice with a pool and a fence.

Speaker 3  5:05  
Exactly the source material points out that combination, especially the privacy fence, because of community rules, and at that price point was, let's just say,

Speaker 2  5:14  
very rare, a tough find, so a bit of a needle in a haystack situation,

Speaker 3  5:18  
pretty much so they found a place, the slice of Florida. Listing made an offer, it wasn't accepted, and their agent actually told the sellers, nope, they're not improving the offer, and they moved on. They found a second choice property and got that one under contract.

Speaker 2  5:31  
Okay? So they had a deal lined up. Plan B was in motion, yes,

Speaker 3  5:35  
but here's where it gets interesting. This is the key maneuver, before they spent any money on inspections for that plan B house, Brad and Shelly circled back to the original slice of Florida House, the one they initially walked

Speaker 2  5:48  
away from, no kidding after saying they wouldn't improve. Yep,

Speaker 3  5:52  
they renegotiated, reached an acceptable price with those sellers and signed a contract for that house too.

Unknown Speaker  5:58  
Wait. So they were under contract for two houses at the same time

Speaker 3  6:01  
simultaneously. Yeah, you can imagine the sellers of house hashtag. One might be feeling pretty confident at this

Speaker 2  6:07  
point. I'll bet that takes some nerve, or, like you said, maybe a specific plan. So what happened with the inspection on the slice of Florida House, the one they really wanted?

Speaker 3  6:19  
Well, it was incredibly fast. Remember, they had an inspection already lined up for the other house. Oh, right. They basically just told the inspector, hey, different address, switched it to the slice of Florida listing. They got it inspected just two days after signing that second contract.

Speaker 4  6:33  
Two days that is quick. This is the time that I'm going to remind you to subscribe and leave a review for the real estate agent man podcast, more than ever before, there is so much more to know about buying and selling your home. That is why we provide professional coaching to Florida sellers and buyers on every episode, we want our customers to have the knowledge needed to make the best decisions possible for themselves and their families. Our real estate team personally covers Sarasota, Charlotte and Manatee counties. That's a wide area. However, Steve also interviews agents from around the state and the entire country to find great agents for customers that are out of the area. Visit slice of florida.com for more information. And now back to the podcast.

Speaker 3  7:21  
Apparently it was quite the performance. The performance how so well Brad was there in person. Shelly joined on video chat. The description is they were like buzzing with excitement, talking loudly about where furniture would go. Brad was apparently even putting tape on the floor to mark out spots, visualizing everything. Oh, really selling it. And he even had a company, Dr aluminum, come out during the inspection to give a quote for a new pool cage. But didn't the house not have a pool cage correct. It didn't have one by design. So he's getting quotes for a major addition while the inspection is still happening. And another detail, Brad apparently made sure everyone knew he was a contractor himself. Oh, really? Why mention that? Well, the implication seemed to be, you know, I can handle any small stuff myself. Don't worry about minor repairs, kind of signaling they were capable and committed. It was a whole show,

Speaker 2  8:13  
wow. Okay, so they put on this big display of, we love this house. We're definitely buying it. What happened right after the inspection

Speaker 3  8:20  
that same night, late, the buyer's agent sends over an email attached a signed release and cancelation form, just like that, after the whole show, just like that. And the email was explicit, Brad and Shelley would only proceed if the contract price was renegotiated, otherwise, consider this our cancelation, the

Speaker 2  8:41  
ultimatum delivered right after they seem totally sold. That's the bluff

Speaker 3  8:45  
in action. Book example, laying the groundwork, then bam, the demand. But

Speaker 2  8:49  
this is where it gets good, right? Because the sellers, they were ready. They

Speaker 3  8:54  
were absolutely ready. This is the crucial twist, the reason the bluff failed, the sellers had a fully signed a backup offer already waiting

Unknown Speaker  9:02  
in the wings. Backup offer already signed.

Speaker 3  9:04  
Yep, ready to go. So when they got that cancelation ultimatum from Brad and Shelley, they didn't even need to negotiate. Nope. They just promptly signed the cancelation form. Brad and Shelly sent, accepted the backup offer and moved on instantly, no drama, no delay, no feeling cornered. Wow, they called the bluff immediately. Completely turned the tables. Their preparedness gave them all the leverage.

Speaker 2  9:26  
And there's that detail about the backup buyers, right, right? They were surprised,

Speaker 3  9:30  
Yeah, apparently the people who submitted the backup offer were a bit skeptical it would ever actually get accepted. You know how backups often just sit there, true, but when they got the call so quickly, saying, okay, the house is yours. They became instant believers in the seller's position. It just highlighted how strong the sellers were because they had that plan B locked and

Speaker 2  9:50  
loaded. That's fantastic. Yeah, it wasn't just a tactic for them. It was a real strategic defense.

Speaker 3  9:55  
Exactly. It shows that the best defense isn't just knowing the other side's moves, but having your own. Counter strategy ready before you even need

Speaker 2  10:01  
it. So let's wrap this up. What's the big takeaway here for you know, for anyone listening, whether you're buying, selling or just kind of fascinated by these negotiation games,

Speaker 3  10:12  
well, I think what we've clearly seen with this specific tactic, the Florida inspection bluff, is how much it relies on the buyer's ability to walk away easily, especially with that, as is contract loophole in Florida, right? The any reason, escape clause, exactly. And the telltale signs are important too, like bringing up the age of major systems late in the game, stuff that was probably obvious from the start, that's a big flag, but maybe the most crucial point is how preparedness on the seller side, like having that solid backup offer can completely neutralize the bluff. It shifts the power dynamic right back.

Speaker 2  10:47  
Yeah, understanding these strategies is just so valuable, isn't it? Yeah, if you're a buyer, you know what's possible, maybe what lines not to cross. If you're a seller, you learn how to protect yourself, be proactive,

Speaker 3  10:59  
absolutely and even if you're not actively buying or selling. It's a well, it's a fascinating look at negotiation under pressure.

Unknown Speaker  11:05  
Definitely. It really makes you think

Unknown Speaker  11:20  
Oscar Sarasota County,

Unknown Speaker  11:27  
your Gulf Coast. Para Steve Martin, 894980094,

Speaker 1  11:40  
four. Surf the web for your next southwest Florida, home at slice of florida.com, and slice of florida.com, with slice of Florida Realty, everything feels right.

Transcribed by https://otter.ai