Guest Post – “Don’t Mess Up in Here!” by Noah Rosenblatt of UrbanDigs.com

A: If you are a new seller, 4 weeks or less, then this post is for you. Fact is, if you take a step back and in hindsight look at the traffic patterns of any given exclusive, a pattern becomes clear. That pattern is sometimes the difference of tens of thousands of dollars in the end; IT WAS FOR ME!

Unless the apartment is aggressively priced, most of the activity will happen in the first 2 weeks and in the final 3-4 weeks (due to price cuts).

THE FIRST 2 WEEKS (The ‘Should Have’ Period)

I like to call the first two weeks of every exclusive the ‘should have’ period. The first 2 weeks is the period of time where you get a bunch of appointments scheduled from ‘B’ buyers who are trying to learn the inventory of their price point and their agents who just want to do a deal already. Maybe you’ll get a few ‘A’ buyers too. Most likely, you’ll get a low ball bid. Many times this very early bid is the nightmare for sellers 5 months later. So, I refer to it from the seller’s point of view as the, “I should have accepted that bid and saved 5 months of agony”.

It makes me think of that scene in Casino where Joe Pesci stares down DiNero as he goes to pick up his wife, Sharon Stone, at Pesci’s restaurant. You know that scene, where Pesci sneers, “Hey! Don’t Mess Up In Here…!”…

(Not the scene, but has that same look)

In Hindsight, every financial decision is 20/20; including whether or not YOU, THE SELLER should accept that offer.

It is during the first two-three weeks of listing your property that you will get the most interest and if lucky, an offer. The offer will not be high but will be very close, the same, or most likely HIGHER than what you eventually accept down the road after multiple price cuts!

I SAY TO YOU, THE SELLER, DON’T MESS UP IN HERE! And if you do mess up and ignore the offer because there is so much activity and you won’t sell below a certain price in the first 4 weeks, to NOT blame it on your broker for failing to move your property at the highest & best price possible down the road.

MY STORY: When I had my condo on the market at Astor Terrace, I showed you the work I did and how I was going to market it, I got the most activity during the first 3 weeks. Every open house was packed and I was thinking JACKPOT! I even got a bid. I was asking $1,075,000 (much higher than I knew it would sell for but it was my home, and my home is worth what I say…yea right!) and got a bid of $950K. I shrugged it away without a response and played hardball. Yea, real smart.

Four months later I found myself $6,000 into weekly NY Times advertising and other marketing expenses, tired, worried, and 2 price cuts down to $975,000. Traffic dried up and I was getting very nervous. HOW COULD I HAVE DISREGARDED THAT OFFER! Nights became sleepless and bills seemed threatening to my financial well being.

I winded up accepting a $935,000 one time take it or leave it bid, up from $925,000 originally. It was all cash and ‘looking to close within a month’ that made the offer a no-brainer for me. But the mistake was made and the lesson was learned.

THE LESSON: Think about any bid that you receive in the first two to three weeks! Think about even if it is well below your asking price. If you decide NOT to accept a low offer in the first 3 weeks, than be prepared to possibly have your apartment on the market for the next few months! I’ll explain why right now.

3rd TO 16th WEEK OF YOUR LISTING

During weeks 3 to 16th of your listing, assuming your property was on the market for 4 months or more, your traffic is pretty much the same; SLOW. The broker is showing the apartment 1-2 times a week, and you are having 2-4 people per open house. Not a good sign. The listing seems to have staled up, and feelings of nervousness fill both the agent and the seller as thoughts of ‘problems with marketing’ begin to arise. I usually hear questions like, “Why aren’t you showing the apartment more often?”, or “The ad in the NY Times wasn’t big enough”, and the best one, “I want this place SOLD, so get to work and SELL IT!”. Yea, ok.

You know what I think at this point? I hate to be the bearer of bad news but if you had 30 buyers through your property with no bid submitted, than your asking price is too high and needs to come down to reality; i.e. YOU HAVE TO WAKE UP!

I’ve said this over and over here on UrbanDigs:

YOUR HOME IS WORTH ONLY WHAT SOMEONE IS WILLING TO PAY FOR IT

It doesn’t matter that you are so close to the subway station, or that you have brand new stainless steel appliances, or even that you have a terrace (cause I had a sick one!). It only matters what a buyer will bid for it and whether or not you HAVE TO sell it right now. The problem is that as a seller, you get emotional and ONLY look at the positive attributes of your property when you price it and review offers! The solution should be to be as unbiased a seller as possible! Notice if your apartment is on a low floor, or has no views, or gets no sunlight, or is on a very busy/noisy street, or has a floor-through layout, or has low ceilings, or whatever! This is what buyers will be thinking about when they bid. A biased seller will be unable to make rational decisions when it comes to accepting an offer.

Moving on.

FINAL 3-4 WEEKS

Traffic begins to heat up as you already hit your turning point and have succumbed to price reductions. It happened for me after 12 weeks on the open market and 11 open houses. A very long time for any nervous seller!

 

I didn’t get a contract signed until the 18th week and 16th open house and for lower than what I was offered 16 weeks ago!

 

Your price comes down and activity picks up. Wow. I can’t believe it. It’s amazing how this works. Why didn’t I think of this earlier? Why didn’t I respect what my broker originally told me 15 weeks ago about where to price my unit? Why was I so blind?

BECAUSE YOU ARE HUMAN. BECAUSE IT’S YOUR HOME. BECAUSE IT’S HARD TO SELL ANYTHING THAT HAS EMOTIONAL TIES, MEMORIES, GOOD TIMES & BAD.

But you must not be clouded in your financial decisions. You must be able to recognize when to move on an offer. You must be able to realize that a highly qualified buyer may NOT be so easy to find!

This post was based entirely on the notion of hindsight and what I have noticed AFTER looking back at my clients and my own exclusive listings, to see if there were any patterns. There were. If anything should be gained from this post it’s that you must have the vision and the will to accept a reasonable offer if:

1. It comes very early and from a qualified buyer
2. Is reasonable in the sense that you were going to price your apartment at $750K but decided last minute to raise that to $800K. Now you get a $700K offer in first 2 weeks.
3. You are under time pressure to sell

Don’t Be Stupid. Don’t Be Greedy. Don’t Mess Up In Here!

By Noah Rosenblatt of Urban Digs.

Advertisements

About Akerly Real Estate

Mike Akerly grew up in Orange County, CA and lived in Irvine until he left to attend the University of Southern California. After graduating with a BA in Political Science, he worked in talent and literary representation at agencies and management firms such as ICM in Beverly Hills and Media Talent Group in West Hollywood. While there, he had the opportunity to work on behalf of artists such as Angelina Jolie, Billy Bob Thornton, Mira Sorvino, Forest Whitaker, Robert Rodriguez, Danny Boyle, and Baz Luhrmann. While in Los Angeles, Mr. Akerly began his career in real estate as a landlord in Orange County before moving on to New York City to attend law school at the Benjamin N. Cardozo School of Law. There, he completed his Juris Doctor with concentrations in real property law and corporate law while he continued his real estate investments with acquisitions in Manhattan. Today he is licensed in California, New York, and Massachusetts. Kate Akerly was born in New Jersey and raised in California. She attended college in Los Angeles where she received her BS in sociology from Mt. Saint Mary’s College. After college, Kate was introduced to real estate as a landlord in Orange County, California. She later moved to New York City where she worked for a city agency that handles civil complaints of alleged misconduct on the part of the New York Police Department. After being promoted to Senior Investigator, she decided to move on to begin her career in real estate brokerage. Kate is now a licensed real estate salesperson who has handled more than one hundred New York City real estate transactions. Mike and Kate now work together from their TriBeCa office in New York City. Together they service clients in residential and commercial brokerage throughout the boroughs. The team also considers investment opportunities in multi-family properties, mortgages, and trust deeds, nationwide. During their free time the two enjoy travel, good wine, great food, and friends. They have advanced certifications in deep water scuba diving and are avid skiers and snowboarders. They reside in Greenwich Village in New York City. If you are interested in purchasing, selling, or leasing residential or multi-family property in New York, California, or Massachusetts, please contact the Akerly Real Estate Team at (212) 400-4838 or via e-mail at KeytotheCity@AkerlyRE.com.
This entry was posted in Guest Posts, Investor information, Seller information and tagged , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s