The Camel's Back.
Most real estate newsletters are about the glory of successful transactions. Agents take credit for strong market conditions touting record prices, smashing reserves etc. but the reality can be very different.
Personally, what I find interesting is not only why deals go well but how they sometimes fall over. Boy oh boy, over my career have I seen some deals implode in spectacular fashion?
When a property is in play we try to advise our clients on both sides of the ledger around risk.
When selling you should push as hard as possible but there is a point where common sense needs to prevail. Recently I was working on a deal where we had a buyer ready to sign on a house well over $6M, a good offer. The owner insisted on pushing for another $50,000 and the highly emotional buyer broke - and just like that, the deal was dead.
I remember another time (more like I can’t forget) when we had a buyer on the auction floor at $8.4Million on a house and our owners dug in at $8.5M certain the buyer would pay up. ‘It’s only a hundred grand’ they said. The buyer walked out….days later they decided to accept but of course the buyer had bought something else (that house sold recently with another agent for $8.15M).
What differentiates real estate transactions to more conventional dealings is the element of emotion. Buying and selling is incredibly stressful and people go through a whole gamut of emotions whilst trying to make critical decisions. I often see calm reasonable people err on the side of madness. In animal terms my Border Collie (Elvis) is a good boy, at the vet when he is tense he’s not such a good boy.
Equally home buyers have to check themselves. So often we have buyers making offers issuing threats to the owners with deadlines or ‘exploding bids.’ Probably not the best play when the owners have a strong emotional attachment to their home.
On many occasions I have seen owners decide to proceed with one party over another at a lower price because they preferred the sound of them. I guess the message is that playing hardball might be fun but sometimes it can backfire.
A great week of sales (even some records!), well done team.
Until next week,
David Murphy