Real Estate Ethics: Do I Have to Honor a Deal Made Before the Market Turned?
Q: I offered to buy my great-aunt's house. In the six months that she's been researching assisted living facilities, the value has decreased a lot. Do I honor the original deal?
A: "There's no obligation to pay more than a fair market price. Ultimately, it boils down to this: How much do you like your aunt, and how much are you willing to give her to help her out?"
— Jack Marshall, president of ProEthics
"Actually, the crucial thing is whether you had a deal in the form of a written contract or a mutual understanding. If you offered a price and she accepted in writing, that's a legal contract and you have to accept the consequences of a downturn in the real estate market, unless your great-aunt wants to let you out of your obligation."
— Anita L. Allen, professor of law and philosophy at the University of Pennsylvania Law School