Tuesday, April 28, 2009

Limbo

The dust has settled and it looks like we have one offer on the house. It's too low ($50,000 less than our asking price), but we're at the initial negotiating stages and as I said yesterday, there's wiggle room. Ron, one of the team of two Realtors we're working with, came by last evening to map out what he thinks the strategy should be for our next step. His 25 years of very successful experience is invaluable, but sometimes his advice is hard to take. And in these situations I'm discovering that I'm much more willing than Steve is to be flexible, to see the glass as half-full, and to play the hand we're dealt.

Our original pricing strategy was to ask $20,000 more than the appraised value, knowing we would never get it, but figuring we would negotiate down to the appraised value, or close to it. Ron suggested a counter-offer--$7500 less than the appraised value--which Steve at first adamantly refused to consider, saying it was much too low. It's true that we (Steve and I vs. Ron) are coming at this venture from very different angles: Ron is all about negotiating a successful and quick sale where "everybody wins"; Steve and I want that, too, but of paramount importance to us is the fact that this transaction is purchasing, literally, the next phase of our life, and we want to wring as much out of it as we can. And while Ron may be a technical wizard, explanation is not his strong suit. Nor is it Steve's.

As is usually the case in any standoff I happen to witness, last night I ended up the mediator--the one who translated Ron's approach to Steve (after coaxing some context out of Ron), and who reminded Ron of our concerns, which encompass a quick sale but are also much larger than that. It's Ron's job to massage the buyer and her agent, to make them see that we are giving up a lot (we are) while still asking for a much larger price than the one they offered. But in order to do that, he needs our cooperation in taking slightly less than we were hoping for. I saw that clearly and understood all of Ron's justifications, and as I sat there was already thinking ahead to what we may have to shave off the North Carolina house in order to make this happen. Steve, on the other hand, couldn't get past The Original Number. Finally, after about 45 minutes of stop-and-go conversation, during which I was sure I would have a stroke controlling my strong impulse to bash these two hard heads together, we reached a compromise. It was tiny, but Steve had his principles. He at first wanted to adopt a "take-it-or-leave-it" attitude and reduce our bottom line just to the appraised value, nothing less. Ron said "take-it-or-leave-it" left him no way to demonstrate to the buyer that we were willing to work with her. Steve finally saw the light and agreed to $5000 less than the appraised value instead of $7500. Ron said he could work with that.

And when it was all over, Steve said, "Now that Ron's gone, I can tell you: that's the number I was willing to work with all along."

AARRGGHH!!!!!!!

So we wait. Ron is presenting our counter-offer to the buyer today. We'll see what she does. Ron says, and I tend to agree, that a house that sits unsold for too long and has a "reduced" sign on it tends to stale quickly and lose potential earnings. Much rides on this negotiation.

Until tomorrow...........

5 comments:

Zoey and Me said...

Ralph, I have to disagree that your agent is looking for a fast sale. The market swing that's out there causes agents to be super realistic and for the sake of the seller, not lose control of the buyer. You may have lost the buyer already, we don't know yet, but today's market activity demands the seller play to the buyer without getting rediculous. Unless it's heading to foreclosure then all bets are off. I don't know the market up there but can tell you 5% off appraisal value here is normal. In fact, some find that the appraisal paid for by the sellers doesn't meet the same standards as the appraisal by the lender. An agent in my office just had a real hot potatoe with the sellers taking 12% less because in the 40 days it sat there waiting to close, other properties closed for less, hence a lower appraisal came in. Not happy clients for sure. Good luck you guys!

Ralph said...

Thanks for the perspective, Z&M,. I guess my usae of the phrase "fast sale" was meant as shorthand for "strike while the iron is hot"--didn't mean it as a negative. The frustrating part was that I saw the logic while Steve was just stuck on The Number.

Just spoke with Ron, who says he's getting "good vibes" from the agent, but we'll see what the buyer has to say....

Mim said...

URGHGHG is right. Things that make the heart beat too fast and sometimes skip beats. Having done this too many times to sit back and relax and say it will work out, for as you said so well you are buying the next phase of your life.. retirement. Hopefully sleep will come easily tonight as you wait to hear.

Ralph said...

Thanks for the good wishes, Mim. I hope we don't have to wait overnight but we may.....

Mark said...

All I know about the current real estate market is that it's scary, man! And we're wishing you all the best with this. I just don't know how to play the poker game of bluffing and negotiating, so I figure, get an agent you can trust and let them do their thing. Good luck - we're pulling for you!