For What It’s Worth
April 29, 2005
Not everyone likes bidding wars. I usually do when I’m representing sellers because it ensures that they receive the best price. But sometimes these wars are counter-productive and here’s why: houses aren’t stocks, they come with all sorts of emotions attached. A family buying a house is seeking a particular neighborhood, a certain school, the right-sized yard, bedrooms and so forth. When they find a house that meets all their criteria they become attached to it and if they see it slipping away from them they can become bitter and resentful. Even if they win the house by paying more than they wanted to or can afford, the bitterness can linger and if, between the time of the successful bid and the closing difficulties crop up, there is no reservoir of good will to draw from to smooth things over. So sometimes it makes sense to just accept a good offer and not reach for the very last dollar. That depends on your own financial needs, of course, but the combination of a happy seller and happy buyer is not only a gratifying sight to behold, it can be a strong glue that holds the deal together. My advice, then, is to determine beforehand exactly what you want from the sale: maximum value, certainty or a specific closing date, for instance, and conduct the sale accordingly. Whatever you do, don’t change your mind halfway through. Nothing is guaranteed to stir up hard feelings more than accepting an offer, letting the buyer spend money on a house inspection, lawyer, and so forth and then accepting a higher bid. Decide beforehand how you will treat bids and stick to it.
Of course, all of the above applies only in a strong sellers’ market, which seems to have disappeared for the moment. There are still bidding wars breaking out in perennially hot Old Greenwich and Riverside but not many, and certainly nothing like was seen in January. A combination of low inventory, high prices and stock market uncertainties has slowed the market considerably. Four houses priced over $7,000,000 went to contract this year and although three of those four entered contract this month, I think we’re seeing the end of the spring market and not its beginning. Of course, if I’m so smart, how come I sell real estate instead of own it?
New York vs. Connecticut
Lucy Krasnor, of Strategy Mortgage Corp (618-4444) has provided me with some interesting data. We’ll deal with average increase in house values next week (it’s all very reassuring) but for now, I thought I’d pass on the results of her comparison of closing costs in Westchester and Fairfield Counties. If you’re buying across the border, be prepared to take out you wallet and dump its contents on the desk—you’ll need a second mortgage just to cover closing expenses. On average, a modest little $1.3 million house will run you $51,656 in costs in New York, compared to $17,813 in Connecticut. The biggest contributor to this whopping discrepancy is, naturally, taxes: mortgage tax, “mansion tax”, school tax, county tax, etc. Of course, our legislature is busy working its mischief, all of it directed at Fairfield County residents, up in Hartford, so this advantage seems doomed. But for now, we’re a relative bargain.
In my cruises up and down the Post Road I have noticed that an increasing number of drivers zoom by school buses stopped and signaling on the opposite side of the road. The offending drivers do so so cooly, with such breezy insouciance that I recently asked a police officer whether the law regarding school buses had changed since I got my license. Nope – the only exception to not honoring a bus’s signals is when the highway lanes are separated by a barrier as, for instance, on I-95. The Post Road is not I-95 regardless of how some people drive on it. The fine for passing a stopped bus is horrendous but I think the life-long burden of having a crushed school child on one’s conscience would be far, far worse. So don’t do that, eh?
As you may know, the town Realtors conduct broker open houses twice a week. Tuesdays are for properties west of North Street, Thursdays for the east. On busy days, it’s a tough chore to get to everything on the list and some days, impossible. So I resent homeowners who, for their own scheduling convenience, insist that their house be shown on the wrong day. I do more than resent, in fact: I boycott the damn things. I refuse to drive way up Taconic Road, for instance, when the rest of the properties I’m trying to see are way to the west. I don’t believe I’m alone in this practice so, while it is perfectly understandable that some days just don’t work for you, you’re better off postponing your open house than holding a party to which nobody comes.
For What It’s Worth