This has to hurt

136 Cat Rock Road

136 Cat Rock Road

This property was purchased as a renovation/replacement project for $1.4 million on November 24, 2003. There were enormous problems with the existing septic field, corrected at huge expense, plus other difficulties but eventually a new house (new from the foundation up, anyway) was put up for sale, while still under construction, in January, 2006. So, 2+ years of loans. No doubt wishing to recoup those loans and make a little profit, the builder made a common mistake and priced the house way above what the market allowed: in this case, initial asking price was $3.750 million which was, in my opinion, utterly ridiculous. That number eventually dropped to $3.4 but when the listing expired a new broker stepped in and raised (!) the price back up to $3.625.

That tactic didn’t work so a third broker stepped in and dropped the price to $2.995, a price that might have attracted a buyer had the place been priced there originally but alas, it was not. So it still didn’t sell and this February, broker number four came in and listed it for $1.999 million, not much more than the land had sold for 4+ years before. Even then, nothing happened until August 28, 2008, when it finally got a contract.

That contract has not closed, almost three months later. The delay might be attributed to the fact that the property has a $2.2 million lis pendens filed against it by the builder’s lender and there might not be enough cash around to pay, say, taxes owed, commissions and all the other assorted transaction costs involved in the sale of real estate. Or not; I’m just speculating here. But if the buyer ever does gain title, I’m sure he’s paying less than that last asking price in which case someone has built him a perfectly nice, brand new house, for free. Good deal.

Yes, there is a moral here namely, don’t get greedy or stupidly optimistic when pricing your house, especially when there’s a foreclosure looming – you will suffer.

Update: Courtesy of reader Jess, you can get details here.

5 Comments

Filed under Buying/Selling Greenwich Real Estate

5 responses to “This has to hurt

  1. Anonymous

    is it just me, or does that gate on the driveway look ridiculous?

  2. too late

    That’s the one I missed. But I can’t afford it now! Keep me updated.

  3. Anonymous

    The gate might look stupid but sub-$2m is a great price and I don’t even know what the size of the place. Chris, any info on the house you could share?

  4. christopherfountain

    It’s about 5,000 sq. ft. with a decent yard and is very nice inside – they did a good job. I’m out of the office but when I return I’ll try to link to the listing, although I’m pretty sure I tried that this morning and failed (a lot of houses on the MLS aren’t on the internet except for their listing broker’s proprietary sites – pretty shabby way to treat a customer, I think, because internet exposure is everything and I haven’t met a seller yet who wanted to limit his exposure to customers of a specific broker ).
    But yes, it was a really good purchase (or will be, once they close) for someone, regardless of what happens to the Greenwich real estate market.

  5. jess

    hi chris,

    here’s the link for details of the house…

    http://136.catrockroad.info/

    I tried to find it on raveis so I could link there but the MLS # didn’t turn up anything.