VOL. 37 | NO. 13 | Friday, March 29, 2013
It don’t come easy: Hard lessons in home buying
It has never been difficult to find new material during my years of real estate writing, as each deal has its own personality. While my clients, past and present, often think they find themselves or their experiences sprinkled among the prose, they are wrong.
Just as disclosure is the key to any real estate transaction, the subject of this week’s column, or at least the main contributor, is Stephanie Tipton Soper, the patient soul who has been my real estate partner for lo these 13 years.
The subject of multiple offers was introduced when a broker of some 25 years called to ask for advice on how to win a multiple-offer fracas. This request is not unusual, as all of us have had our respective hats handed to us in these acts, which are occurring all over town.
His thought was to “come in high and put a deadline on the offer.’ In other words, he felt he should make an offer higher than the list price, thereby guaranteeing the seller a better price than anticipated and forcing the seller to act sooner rather than later.
My thought on that idea was that listing agents do not give any weight or thought to time limitations. They and their sellers do whatever they want to do. I also provided him with some advice on the pricing.
He stuck with his plan, and the listing agent told him that they would respond when they were ready. If the offer expired, the agent added, it was off the table and they would consider it no more. He came in higher than list price, but not enough. His client lost its third skirmish, although in the long run they might have won the war.
This is where Stephanie comes in. Her new soliloquy to first-time homebuyers is as follows:
“We are going to look at houses and you are going to find the home of your dreams, or at least you think it is the home of your dreams. But remember, you thought your first boyfriend was the man you would marry. How would that have worked for you?
“So, you’ll make an offer on the house, but not for asking price because your parents will think you are crazy for offering asking price for your first home after only one day of looking. So, we’ll write the offer, and you can see a contract firsthand and learn all about agent confirmation, property disclosures, another form called additional disclosures, because they forgot to put these in the other disclosures.
“You will learn not to eat lead-based paint and to fear termites worse than rats and mosquitoes. You will learn about agency, home warranties and inspections, and learn about appraisals and title insurance. Right now you don’t know squat about any of these.
“Then we’ll make the offer for a little under list price and you think that they will counter, but they won’t. But you still will think they will and you’ll call your parents and tell them all about the house you just bought – for under list price. Then the seller will tell you to screw yourself, and me as well. But that’s OK because it was good practice. Your parents will think it was an anomaly.
“Then we’ll go out again and you’ll find your second boyfriend. How’d that work out? OK. So we’ll find a house, and you’ll be a bit more courageous and you’ll offer list price, justifying it by saying there are some things wrong with it and that it is overpriced anyway, and you’ll be sure that the seller will counter this one. They won’t and they’ll give us some advice about a horse that we rode once upon a time.
“Finally, we’ll find a house that works well enough and you’ll offer over list price and close whenever the seller wants along with a letter telling them that you will raise your family here and contribute to their favorite charity. If your offer allows yourself to be screwed in no other way, you may get it.”
Sales of the Week
It has been noted that recent high-rise developments are faring well in the local market, in particular the Icon, Viridian, Encore and Adelicia.
As the skyline filled with cranes in the mid 2000s, many speculated the city had overbuilt and predicted that many of the developments would fail. Many held on through the recession by the grace of God, and others by the grace of the Turners.
One high-rise that did not quite survive was the Rhythm on Demonbreun Street, a development that went into receivership, albeit late in the going and when things were on the upswing.
The Rhythm has now joined the ranks of the profitable, at least for the owner of unit 1107, who bought her condo in November 2009 for $205,000 and sold it last week for $257,900.
Grant Hammond of Grant Hammond fame represented the seller, as he often does, and Bonnie Kearns of Parks, nee Village, delivered the buyer. The one-bedroom, one-bath home has 785 square feet – $328 per square foot – with a den and kitchen.
The Rhythm has an enormous pool amid a great expanse of concrete and covered patios with grills, bars and panoramic views of downtown. The building is 15 stories and located among cars, restaurants and the Demonbreun excitement.
In the midtown area, the 12 South Towers that soar some three stories into the sky are performing well, as unit 127 closed last week for $230,000 after being listed for one day at $229,987, a strange price indeed.
The price was exceeded, and listing agent Drew Hendry’s bait worked, snagging the attention of Chan McCullough of Evans Realty Management Company. Hendry is with Silverpointe properties.
The owners of skyscraper had paid $157,017 in May of 2004, so all of this ciphering with unorthodox numbers worked in their favor. Perhaps there is something to this numerology thing.
Richard is a partner with Christianson, Patterson, Courtney and Associates and can be reached at email@example.com or followed on Twitter at @movetonashville.