Sellers do research, too
I have made several offers on lovely homes in the Vail Valley, but I have been frustrated with the unrealistic prices the sellers are asking. When I have my agent write an offer, I always request that she include all the comparable homes that have sold for much less a square foot, fully justifying my offer. So far, the sellers have ignored the facts and clung on to their fantasy that their home will sell for more than anyone else got in the area. Is this just the mentality of a resort area, or a sign of the current market or what?
Dear Bottom Feeder,
I am using this name as it is how you appear to the sellers you have been working with recently. Most sellers have spent a great deal of effort, and sometimes money, to determine a price for their property. Some have had appraisals, insurance estimates, consulted with their listing agent and they have also done in depth CMA’s (comparative market analysis). The difference with your CMA and the seller’s CMA is that the sellers used different comparables and added money for special features, such as furniture, more square footage, basements, garage space, more land, higher quality finishes, etc. I can tell you that a listing broker and a buyer’s broker can argue forever about why a property is certifiably worth more, or less, and the argument never ends — and never has a winner.
I know you believe this seems like the perfect way to argue your case, but it can be the death knell to getting a deal together. Ultimately, the correct sales price is what the buyer will pay and what the seller will accept, not necessarily the price the “facts” dictate.
My suggestion to you would be to make sure your agent is working for you as a buyer’s agent, not just a transaction broker, so that they can find out the motivation of the seller. A buyer’s agent can talk with the listing broker and use whatever means are at their disposal, which is sometimes past knowledge, to determine what works for the seller. For instance, if a property was just recently listed, then the seller may be more firm on their asking price.
If the seller has just started building a new home, then they may actually not want to sell right away, unless of course they get their full price. Sometimes one of the owners wants to sell but the other does not, so the reluctant seller may insist that they get full price or they won’t sell. However, if a seller is building another home and it is almost finished, then they may be more flexible (how we bought our townhome in Florida at a great price). Or, if a seller is moving out of the area, then he may look at a lesser offer from the very first day of the listing. In a case where the seller has been renting the property and the renters have left, they may be more anxious to sell after they have gone a few months without rent.
As you can see, the various reasons sellers will sometimes stay firm on their price or they will have increased motivation to sell for a lesser price, can go on and on. We are all human and even though this is a business decision, emotions and life situations make big differences in what financial decisions people make.
My suggestion is that you attempt to see the situation as if the tables were turned and you were the seller, find out their motivation for selling and then make a reasonable offer — who knows, you might just be the proud owner of a beautiful home in a fabulous resort area! Good luck!
Joan Harned is an owner and broker for Keller Williams Mountain Properties and heads up Team Black Bear. Harned has been selling real estate in Eagle County for 27 years, is a past chairman of the Vail Board of Realtors, past Realtor of the Year, past director on the Great Outdoors Colorado Board and a member of the Luxury and Land Institutes. Contact Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or wwwSkiAndTeeHomes.com.