Bidding Strategies
Low Balling
Greenwich real estate attracts a fair number of Wall Street traders who, not surprisingly, bring their work tactics with them when shopping for houses. That means that they throw low bids at everything and see what happens. Often, the answer is nothing; the seller refuses to counter and the buyer moves on. But sometimes, a deal is struck. So when should you low ball? It depends, naturally, on the circumstances. A house that was originally listed for $890,000 (readers should feel free to add zeros until they reach their comfort zone) and has sat on the market for months might be ripe for a low bid of, say, $695,000. Another home priced identically but actually worth $890,000 will not fall to your charms. The basic advice is to work with your agent (assuming she’s earned your trust) and follow her advice. We hate to look stupid (a losing battle for me) and will resist fiercely any attempt by our clients to submit dumb bids. For instance, this firm’s listing on MacPhearson Drive, discussed last week, was priced at $2.895. The price was right, there were a number of interested buyers and it went immediately for more than its asking price. A low ball bid would have been pointless in that situation and an agent who submitted such a bid would have looked as foolish as she felt. But other homes are not so well priced; the agents all know it long before the seller will admit it. You might want to put in a low bid on that kind of property long before it sinks to its proper level but beware: it is the rare owner who will acknowledge that he’s over-priced his home without suffering for awhile. Still, bids are free, so if your agent agrees, go for it.
Old Greenwich Victorian
One home that is not going to be (successfully) low balled is Joan Epand’s (Shore & Country) new listing at 14 Nawthorne Road. Built in 1904 and completely and beautifully renovated last year, this three-story house is in turn-key condition. Six bedrooms, three baths, huge new kitchen and all new mechanicals. It’s very, very nice and, although I personally would like a larger yard (the site is a quarter-acre), that’s about what you get these days in Old Greenwich. Asking $2.795 and, given comparable sales in the neighborhood, likely to get it. Good house.
Contracts
Homes that went to contract this week include Blanche O’Connell’s listing at 31 Lindsay Drive ($3,450,000); Julie Church’s (Sotheby’s) at 50 Richmond Hill Drive ($4,770,000), and our listing at 2 Ashton Drive ($6,100,000). Eighty-one Butternut Hollow Road sold for $8,750,000 the impressiveness of which is tempered by the fact that it last sold, in January 2000, for $10,000,000. That buyer put it back on the market in April 2000 asking $14,000,000. A bid of 0.625 of that amount would qualify as “low ball” in my book but it worked; it just took twenty-seven months to reach fruition.
Riverside Lane
Josiane Collazo’s listing at 78 Riverside Lane went to contract July 18th for $1,749,000. It’s a brand new, well built house and the almost identical home next door sold last fall for somewhere in the $1.5s, but still. . .this is Riverside Lane. The homes there were originally built as temporary veterans housing and were intended to be torn down. Sixty years later, they are finally going, replaced by homes and prices that, I suspect, those veterans would never have imagined. A real bargain on that same street, although without the access to the Mianus River, was Jennifer Walsh’s listing at 102 Riverside Lane for $550,000. I wrote about it a few weeks ago and now it has an accepted offer. You should have listened.
Yeah But
In last week’s article on gazumping I suggested that buyers not spend a dime on a house until they had a fully executed contract in hand. But what, you ask, do you do about the current practice in Greenwich that dictates building inspections be done before anyone signs a contract? I’d suggest a provision in your original offer that, should the seller renege, he’ll reimburse you for the actual cost of the inspection ($600-$850, generally). The downside of this is that the seller can accept a higher offer and ease his guilt by forking over the inspection money. But if he’s that type of guy, he’d probably stiff you anyway, so what the heck. Ain’t life grand?
Greenwich real estate attracts a fair number of Wall Street traders who, not surprisingly, bring their work tactics with them when shopping for houses. That means that they throw low bids at everything and see what happens. Often, the answer is nothing; the seller refuses to counter and the buyer moves on. But sometimes, a deal is struck. So when should you low ball? It depends, naturally, on the circumstances. A house that was originally listed for $890,000 (readers should feel free to add zeros until they reach their comfort zone) and has sat on the market for months might be ripe for a low bid of, say, $695,000. Another home priced identically but actually worth $890,000 will not fall to your charms. The basic advice is to work with your agent (assuming she’s earned your trust) and follow her advice. We hate to look stupid (a losing battle for me) and will resist fiercely any attempt by our clients to submit dumb bids. For instance, this firm’s listing on MacPhearson Drive, discussed last week, was priced at $2.895. The price was right, there were a number of interested buyers and it went immediately for more than its asking price. A low ball bid would have been pointless in that situation and an agent who submitted such a bid would have looked as foolish as she felt. But other homes are not so well priced; the agents all know it long before the seller will admit it. You might want to put in a low bid on that kind of property long before it sinks to its proper level but beware: it is the rare owner who will acknowledge that he’s over-priced his home without suffering for awhile. Still, bids are free, so if your agent agrees, go for it.
Old Greenwich Victorian
One home that is not going to be (successfully) low balled is Joan Epand’s (Shore & Country) new listing at 14 Nawthorne Road. Built in 1904 and completely and beautifully renovated last year, this three-story house is in turn-key condition. Six bedrooms, three baths, huge new kitchen and all new mechanicals. It’s very, very nice and, although I personally would like a larger yard (the site is a quarter-acre), that’s about what you get these days in Old Greenwich. Asking $2.795 and, given comparable sales in the neighborhood, likely to get it. Good house.
Contracts
Homes that went to contract this week include Blanche O’Connell’s listing at 31 Lindsay Drive ($3,450,000); Julie Church’s (Sotheby’s) at 50 Richmond Hill Drive ($4,770,000), and our listing at 2 Ashton Drive ($6,100,000). Eighty-one Butternut Hollow Road sold for $8,750,000 the impressiveness of which is tempered by the fact that it last sold, in January 2000, for $10,000,000. That buyer put it back on the market in April 2000 asking $14,000,000. A bid of 0.625 of that amount would qualify as “low ball” in my book but it worked; it just took twenty-seven months to reach fruition.
Riverside Lane
Josiane Collazo’s listing at 78 Riverside Lane went to contract July 18th for $1,749,000. It’s a brand new, well built house and the almost identical home next door sold last fall for somewhere in the $1.5s, but still. . .this is Riverside Lane. The homes there were originally built as temporary veterans housing and were intended to be torn down. Sixty years later, they are finally going, replaced by homes and prices that, I suspect, those veterans would never have imagined. A real bargain on that same street, although without the access to the Mianus River, was Jennifer Walsh’s listing at 102 Riverside Lane for $550,000. I wrote about it a few weeks ago and now it has an accepted offer. You should have listened.
Yeah But
In last week’s article on gazumping I suggested that buyers not spend a dime on a house until they had a fully executed contract in hand. But what, you ask, do you do about the current practice in Greenwich that dictates building inspections be done before anyone signs a contract? I’d suggest a provision in your original offer that, should the seller renege, he’ll reimburse you for the actual cost of the inspection ($600-$850, generally). The downside of this is that the seller can accept a higher offer and ease his guilt by forking over the inspection money. But if he’s that type of guy, he’d probably stiff you anyway, so what the heck. Ain’t life grand?
posted by Chris Fountain at 10:14 AM
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