Another week, another closing that I was and am grateful to have assisted in, another display of the wide gambit that humanity has to offer. In every deal there’s the real estate portion. The drywall and porch, the stove and the den. There’s a location, a lawn, a driveway, perhaps a garage. This is real estate, but this is not what a real estate deal is about. A real estate deal is about people. It’s about winners and loses, profit and loss, dreams realized, dreams postponed, and dreams that were just sort of dreams abandoned. Lakefront real estate is fun, maddening, exciting, dull, life affirming and soul sucking. Enter 1540 Lake Shore Drive, Lake Geneva.
This lakefront home, with an entry level frontage tally of a little less than 50, sold last year for $1.2MM. The owner of that home fixed it up. New this and new that, but it doesn’t really matter. The owner bought furniture, trinkets, a boat and a shore station for that boat. That owner made the home rather cute, and last Friday, after a year of the prior owner doing various things to the home, my stand up client bought the home for $1.335MM, not including a personal property agreement to make sure that the boat, the lift, the furniture, and even the decorations on the mantle, stayed. My client, a young family from Chicago, purchased their first lake home and will now begin the next chapter. The title of that chapter is “The Lake”. Seriously. That’s the chapter name. I’ve seen the book. I was supposed to read it in high school, but I probably didn’t.
That’s the deal, but that’s not the lesson from this sale. The joy of a new family spending their weekends lakeside is indeed pronounced and fabulous, and I know better than they do how exactly this is going to change their life for the much, much better. This isn’t the most important lesson here, though if you’re sitting at your desk wishing for a weekend that entails more than waiting in line for brunch before walking to THE PARK!, then that lesson is indeed the only lesson you need to heed. Instead, this is a lesson about life, about transactions, and about the uncomfortable gyrations that people can make when it comes to real estate. These lessons apply to every real estate deal, everywhere.
First seller pro-tip: The fact that you may or may not be losing money on your real estate means nothing to anyone. It doesn’t. The world doesn’t care if you lose money on a house. Everyone who is supposed to will still wake up tomorrow, whether or not someone that none of us knows loses any money on a house. If you buy a home, fix that home up and then flip it for a profit, we are extremely happy for you. HGTV may give you a television show, and if they don’t, then coif your hair a bit higher and drive a Ferrari and Bravo will definitely give you that show. It’ll be called “You’re Awesome At Real Estate”, and everyone, or no one, will watch it. However, if you lose money on a home that you owned for 10 years or for one year, this is of no consequence to anyone else. It is also of no consequence as to the actual value of your real estate. If you buy a car for $90k and drive it for two years, it’s worth $45k. No one cares that you lost 50% of your money, because this was your decision, and your loss has nothing to do with the value of your car.
Second seller pro-tip: Do not look a gift horse in the mouth. I have no specific idea why you shouldn’t do this, though I fear that whomever coined that phrase made the mistake for the benefit of all of us. We now know. The application in real estate is simple- when someone is in the process of bailing you out, treat them well. If you own a condo that you want $500k for, but it’s worth $400k, and someone walks up and offers you $440k, don’t just look at their mouth. Take their money and run for the hills. Fast. Buyers are not as omnipresent as sellers think. Every home isn’t selling. Your home might sell, but only if you wise up and take an offer that is right in front of you. And if you do take that offer, and hesitantly accept the offer from someone who is throwing you a lifeline, treat them nicely. Obey your contract. Don’t get a big head just because you have a piece of paper with a few signatures on it. Humility in contract fulfillment is important, especially if you’re a seller. Also, it’s good for every seller to remember that generally speaking a seller needs to sell much more than a buyer needs to buy.
There are other lessons here, but my time this morning is brief. A big congratulations to the lovely family who now has no excuse to ever stand in line at the swing set of their Chicago neighborhoods’ playground. I’m grateful for the opportunity to have helped with this purchase, as I’m grateful for every single deal that I’m ever a part of. Additionally, a thank you to the other broker who navigated a complicated transaction. That sale was my fourth lakefront sale of 2013, which means at least four families are likely enjoying their weekends far more than you are. I’d love to help fix that.