In February of 2011 a sturdy brick ranch on quiet street near the lake hit the market. There was very little fanfare. I noticed, because I notice everything, and I’d bet you now that I made a little fun of this new listing way back then. There wasn’t a market for a $1.39MM house off the lake when lakefront homes could be had for the same price. Why buy a house, even if it is a very nice house with a super fancy built in Espresso maker, for the sort of price typically reserved for an actual lakefront home? I didn’t need to answer that question either. The house was nice and the refrigerator happily below Zero, but it was just a house on a street for a whole lot of money.
The market proved difficult for this home at that price, so over time the price dropped a bit. And then it dropped some more. And then a contract. A contract! Closing was set, until it wasn’t. The deal feel through and the price dropped again. A prized client of mine took notice, and we found our way to this property, now offered as an approved short sale. We made a bid. We waited. We grew impatient. We grew weary. And then, last Thursday we started a closing on the property. The closing took much of Thursday and then we tried again some more on Friday, and by Friday afternoon we had closed on this beautiful brick house on Geneva Bay Drive for a pleasing price of $730,000. The final asking price was $880k, we closed for $730k.
All that means is that I have recently misled you. Unintentionally, sure, but still misled. That 16.5% off ask that I told you had been my average negotiated discount of late isn’t really 16.5% anymore now that I just negotiated Geneva Bay Estates 17.1% off the most recent ask. Granted this was a short sale, but there’s a truth in this sale that you can apply to your own foreclosure knowledge. This short sale was negotiated to such a point that it was more sensible to buy it as a short sale rather than wait some time for it to go through the sheriff’s sale process before finally being relisted as REO. REO sales aren’t being bought as cheaply as they once were, as Fannie Mae and her banking friends seek to tighten up the losses on these bank owned properties. In the case of 1885 (1882) Geneva Bay Estates, the short sale yielded the better value. $730k for a beautiful newer home with slight lakeview located within a line drive of the lake? That’s a deal I’ll make anytime I can find it.
Another property closed last week as well, another property with lakerights. Oak Shores, the ranch listing that I had earlier this year and failed to sell at $700k or so, closed last week for $515k. When viewed straight against the most recent $549,900 list, that sale represented a 6.4% reduction off of the ask. Which begs the question yet again: Why aren’t we working together? If real estate is about scoring the best value- lasting value- in a solid neighborhood with solid amenities and solid hopes of future gains, shouldn’t we then decide to pursue that value with the goal of actually beating the market?
Real estate is less and less about value, and more and more about relationships. This works at times. If a dear friend is a Realtor and they happen to be an outstanding one, this is fabulous. You’re lucky! But, if your relationship with a Realtor is based on some loose connection between a mutual friend, and that Realtor cannot present to you a clear picture of value and how to go about grabbing hold of it, doesn’t that loosely cobbled relationship just end up costing you money? It does. And people fail to realize that. If real estate was simply about filling in blanks in contracts anyone could do it well. If real estate is about seeing through the difficulties of a market and then securing lasting, serious value, then it’s time to practice a little discernment in the choice of your Realtor.
To the client who let me help on the Geneva Bay Estates purchase, I am grateful. It was a stressful closing, to be sure, though working with even keeled buyers tends to make even possible catastrophic closing events fade to calm. To those buyers I offer the same advice that I offer to ever buyer: Use the house. If you buy a vacation home at Lake Geneva and you use it as much as possible, on every free weekend and bright Wednesday afternoons as schedules allow, there’s no way to regret the purchase.