Blog : Contracts

Perspective Sadness

Perspective Sadness

This very well could have been the Cubs Didn’t Get Swept But They’re Still Terrible Sadness post, but that wasn’t really bothering me this morning. The Cubs were beat by a vastly superior team.  Perhaps if our big hitters had hit and our decent pitchers were decent, then maybe things would have been different. But they weren’t different. They were awful. Just awful. Embarrassingly awful. And so for now my only Cubs memory from 2017 will be one of joy. Joy that I didn’t spend any money to attend a playoff loss.

Even this, though, is about perspective. The Cubs were bad in these playoffs. Really bad. Don’t forget they were also bad last year in some of those games. Super bad. But they still won a lot of games and we still were able to watch terrible baseball well into October, and so this is something good.  Perspective as it relates to baseball fandom is not really difficult. Just remember your team was better than most of the other teams, and in that there is some consolation. We could have been Brewers fans. Perspective in real estate transactions? It’s as rare as a Lackey fastball that doesn’t end up in the basket.

When real estate deals are small, every dollar really matters. If you’re a seller of a house listed at $119k your contract is for $114k,  your mortgage payoff is $105,989 and your closing costs total $8155, then numbers really, really matter.  The car needs rear brakes and there’s a final balloon payment past due on Timmy’s braces. These are difficult times and those are difficult circumstances.  Real estate transactions are all stressful, no matter the dollar amount or the location, but are all transactions created equal? Not at all.

And this is where the perspective comes in. The earlier example is indeed a stressful situation. It’s stressful because in that life, every single dollar matters. Every dollar is one to be stressed over. If a deal with that structure requires a $4,000 inspection repair to be made in order to keep the deal together, that $4k is the difference between solvency and insolvency. Not between life and death, but in that circumstance that’s likely how it feels.

Now, find another deal. Say one on Geneva Lake. One where the sales price isn’t $115,000, but $3,500,000. The mortgage is $1,700,000 and the closing costs are $150,000. Now add in the $4,000 inspection repair or credit. Does this matter? Is this something that means anything at all? Is this something to languish over? Is this something to dwell on? The answer is painfully obvious, but in this real world of high end real estate, many people still dwell on it like it’s the last $4,000 that was earmarked for paying past due medical bills. This is a shame.

This is where perspective is lost. Abandoned, willingly, routinely. Large real estate deals require large amounts of perspective, and this perspective comes in the form of not fighting over insignificant amounts of money. But David, every dollar counts! Yes, I understand that. But do I? When I sell a house that I personally own, I’ll make repairs to that house regardless of what was, or was not, found in an inspection report. I do this because I want the new buyer to be happy. I don’t want the new buyer to wander around the house the day after the closing and curse my name for the things I covered up.

But this isn’t just about sellers. This is also about buyers. Let’s say that the seller won’t make a repair. Let’s say they refuse to give you that $175 plumbing fix. Is this going to ruin your life? Is it really going to make the house you already decided you want to own somehow inhabitable? Is it going to matter at all? Does any of this actually matter?

Today, it’s just about simple perspective. Do what’s right. Today in Lake Geneva there are lots of deals. Lots of high end deals. Lots of lakefront sales for big dollars and off-water sales for big dollars. Sellers, please listen to me. If a buyer wants to give you $1,500,000 in cash and they expect you to fix two leaky faucets and a rotted windowsill, just go along with it. Be happy. Life is good. It’s short. And that plumber’s bill isn’t going to require your last $175.