July 06, 2005

the sale

Because I said I would, because StealthPunch asked, and because if I don't write it down I'll inevitably forget the details, here's how we sold our house. Or, rather, how we made the decision about which of our three suitors was the right one. Don't know how helpful it'll be if you're not selling to investors, though.

Suitor #1: Spiffy, speedy, and direct. Made the offer the first day the house went on the market. An offer complete with bank statement showing he had the down payment plus some. When we said, "But you haven't even seen the place," he said, "I'll come by now." When we said, "But we're not ready to make a decision," he said he'd wait but he would not get into a bidding war. No way, no how. His goal: do a 1031 exchange, put capital gains back into properties and avoid taxes. Investment, pure and simple. And yes, maybe he'd want to build. He wanted to leave his options open. (I consider it probable, but you never know.) His company's longevity (our realtor looked it up): over three decades. His bid: list price.

Suitor #2: The shy type. No, scratch that. The impenetrable type. The two-steps-forward-one-step-sideways do-si-do type. Man came sailing into the open house, zipped through the house, handed our realtor a sealed envelope with a pre-written bid. But, um. Man was not buyer. Man was go-between (ie: realtor). Suitor never saw the place. Nor did any member of suitor's family. Broker said he'd send a pre-qualification letter over ASAP. Our broker said great. Next day, our broker said, "Where's the pre-qual?" "My printer broke, I'll get it to you now." Your printer? What, you have a bank in your realty office? What kind of meaningless pre-qual letter is that? Suitor #2's goal: to build. Wait, no, to buy for his daughter to live and THEN to build. Mmm hmm. And his daughter has no say in this? Has never seen the house? Mmm hmm. Sure, I believe you. Sure I do. His company's longevity: two years. His bid: $26K over list price.

Suitor #3: The "Hurry, hurry, I'm gonna be late! Late for a very important date!" type. Faxed over a bid the evening our realtor was writing up counter offers. Sight unseen yet again. His company was named something or other Exchange and his bid included some phrasing that left the door open to someone else buying the property, and he'd be the go-between. IE: his business was finding places for other people to buy as 1031 exchange-style investments (see Suitor #1). His company's longevity: can't remember, but there was something odd about it. His bid: $27K over list.

The dilemma: Suitor #1 was clearly the most solid. Had the money, had the track record. And he did his research up front: he talked to his architect, discussed the property with him. He called the city to make sure permit regulations hadn't changed recently. He knew whether he'd be able to build a condo complex on this lot before we even made the counter-offer. The other two guys might well back out during escrow. Builders do that all the time, apparently. They leap on a property, tie it up so it can't run off with someone else, then they see if they really want it after all. So #2 was definitely a gamble. And #3 might not make his deal during escrow. But. That's enough money to make a gamble feel worthwhile. If you're the gambling type. Which we're not. Except for the whole picking-up-and-moving-across-country thing, that is. But still. $26K, nothing to sneeze at. Could buy us more time to make this transition work. But if we fall out of escrow because we go with the wrong guy? Ugh. If a suitor takes you to the Four Seasons for dinner and settles you in box seats at the opera on your first date, that doesn't mean you'll have a caviar relationship. Or any relationship at all.

The solution: Through our realtor, we explained our situation to #1. Said, "We don't expect you to come up to the other offers, but can you make this an easier decision for us?" He came up halfway. $14K over list. We went with him. And it's worked out just fine. All the contingencies have been removed, right on time. This deal is going through, just as we knew it would when we signed the escrow agreement. Believe it or not, I trust this guy. And that's important here. I'd rather make less but see the money, y'know?

Posted by Tamar at July 6, 2005 02:15 PM

I have sold three houses (btw,the first one was in Maplewood NJ) and my number one rule (I read this in a book) in every transaction has been Don't Get Greedy. Sounds like you made a Very Wise Decision ... and isn't it nice that by being straightforward with Buyer Number One you did get a little more money out of it?
Oh yeah I miss Maplewood lots but headhunters call and I'm a Cali girl at heart.

Posted by: firsttimecommenterfromNorCal at July 7, 2005 10:01 AM

It's interesting to hear about this from the other side. We didn't get the first house we offered for, partly because, we were told, they didn't like our 80-10-10 financing. That seemed so bizarre to us... they'd get their money, why on earth did they care how we financed it?

Posted by: sleeky at July 9, 2005 11:48 AM