The Common Law

We entered a contract to buy a cool house in Central Austin and then spent weeks lining up financing. We were prepared to close the deal, but then at the eleventh hour the seller called and said they didn't think the sales price was enough and unless I paid more they would cancel the contract. I want the house. Can I force them to sell it to me?

Your heart is set on a new home, you picked out your new paint colors, and you are only a few days away from moving in. Until the unthinkable happens and the seller tells you they want out of the deal for no apparent reason other than they wish they hadn't entered the contract. This is the classic case of seller's remorse – when sellers change their minds after the real estate contract has been signed because they become unhappy with the sales price.

A valid contract exists for the purchase of real estate once a seller and buyer agree to contract terms, sign the contract, and initial terms are satisfied (typically when the buyer provides the option fee and escrow funds). If the buyer complies with all contractual obligations but the seller refuses to move forward in compliance with the contract's terms, the seller has breached the contract.

You can pursue several different remedies for breach of contract, including monetary damages. There are, however, some situations where courts deem monetary damages as inadequate, including real estate, which courts view as unique (i.e., you can't go out and find an exact property to replace the property that you had under contract). Awarding monetary damages for breach of contract for the sale of property often does not put the jilted buyer in the same position as they would have been in if the contract was honored by the seller.

In these unique situations, a court could order specific performance, which requires the breaching party to perform the obligations set out in the sales contract. Based on the facts you describe, you may be a very strong candidate to obtain specific performance, although you should consult with an attorney to learn more.