What does it mean when a house is under contract?
You keep seeing properties online that interest you but your agent keeps telling you they're "under contract" or "pending". What and why is that?
When a property goes "under contract" in Colorado that means a buyer and seller have reached an agreement and are proceeding with the sale of the house. In other states there are different terms for this but in Colorado we just call this the under contract or the contract period. The buyer has the chance to do due diligence, inspections, appraisals and so on. And the seller knows they have a committed buyer for their house.
No other buyers are able to directly supersede an existing contract. Like for example if a house is under contract another buyer can't just approach the listing agent to find out how much its under contract for and then beat that price. That's unethical and not in good faith. Theoretically a buyer could approach the seller directly but this is a great place to tread super gently and probably with a lawyer.
The most common question that comes up from the agent's stand point is hey what about this house right here? I saw it on this website or that website and it seems like a great house, what's up with it? When your agent tells you that house has already sold or is under contract please don't get mad at your Realtor. Often times the data feed from the MLS where our sales business is done and whatever website you may be seeing could either be malfunctioning or just not set up right at all.
The reality of the 21st century is that data is worth a lot of money. Each listing, each sale, each comp, each rental is a billboard for some website who's business it is to get clicks. So when you arrive at some massive real estate website who's name rhyme's with pillow and you see data that is incorrect know that is not because your agent is out to mislead you. It's just because that website is a super sophisticated form of clickbait. Their business is to attract potential buyers and sell your data back to agents who's business model depends on it. That's the hustle.
So when you see a house that's pending or under contact or contingent just know it means there is a buyer in place already. You can keep an eye on the home if it really interests you and if it falls out of contract you can absolutely make an offer. You can also submit a back up offer in some cases if the seller is willing to accept them. But just like if you were the buyer in a contract have respect for other buyers going through that process and understand that bad data feeds on the internet are not your agents fault but part of their list of stuff to deal with.