The Risks of Selling Properties Sight Unseen

Why are people buying houses sight unseen? If you work in the real estate business or own a company that has commercial properties to sell, you may have been asking yourself this key question. Although sight-unseen purchases remain relatively rare, the number of buyers making offers on properties without visiting them in person first may slowly be going up over time. If you already have Real Estate Insurance protections in place, you should know that there are still additional risks when selling your business properties sight unseen that you could potentially run into. Can you sell a house sight unseen and avoid lawsuits or reputational damage? If you keep reading and carefully review the risks involved before proceeding, the answer may well be yes.

You May Have To Deal With Disappointed or Frustrated Buyers

When buyers purchase properties without having seen them in person, frustration or disappointment can sometimes ensue. In some cases, your business may be on the receiving end of these emotions. After some sales, you may have to deal with:

  • Disappointment with the appearance or other aspects of the property in person
  • Frustration about perceived misrepresentation or misleading claims made during the purchasing process
  • Frequent calls or emails with complaints or follow-up questions

One of the biggest risks involved in sight-unseen sales is that your business could leave itself vulnerable to business lawsuits. Some of the most common types of real estate claims you could face include:

  • Misrepresentation or failure to disclose
  • Real estate fraud
  • Negligence and/or failure to advise
  • Breach of contract
  • Breach of fiduciary duty

You May Need To Take Additional Steps To Ensure Transparency

Whatever types of properties your company may be selling, it may be a good idea to take additional steps to ensure transparency. In particular, your business should:

  • Never exaggerate or misrepresent features of the property or facts about the property
  • Inform your potential buyers of all known property defects and potential issues
  • Provide the buyer with the property’s tax history and damage history
  • Take photos and video tours that accurately depict the property
  • Discuss buyers’ concerns with them and provide objective answers
  • Draft up written agreements to ensure both you and your clients are protected

Even if your business already has thorough Real Estate Insurance, it’s still important to be aware of the most common risks in selling properties sight unseen before proceeding. Although this method of selling has become more popular in recent years, it can still leave business owners vulnerable to issues such as reputational damage from frustrated buyers, lawsuits, and claims of a lack of transparency. Before you sell another commercial property sight unseen, review these risks to prepare yourself and the business for the process ahead.

About Provident Protection Plus

At Provident Protection Plus, we have served the businesses and residents of New Jersey, New York, and Pennsylvania for more than 60 years. We are a wholly-owned subsidiary of Provident Bank, the region’s premier banking institution, and we are prepared to offer you personal, business, employee benefits, and risk management solutions. To learn more about our coverage options, contact our specialists today at (888) 990-0526.