Price it, sell it

6 Loading Rock

6 Loading Rock

I know I’m an evil ogre who tears down homeowners’ property values but trust me on this: pricing is not that difficult. This house on Loading Rock is a well built house, no back yard to speak of but the community beach right across the way. It’d be a great place to live, but when it came on January, 2008 priced at $3.695 million, what was I or any other agent supposed to do with it? Sell it? At a price never even approached in that neighborhood? Of course not, so it sat for 18 months, eating up the builder’s money, until he finally got it down where it should have been in the first place, $2.650 million. Now it has a buyer and Joanne Gorka has him – good for her, because Joanne’s a real keeper.

But any one of my children could have been given the price history on this street and a tour of the house and done a better job pricing it than its builder. Yours could, too. Ego and delusions are expensive luxuries in this business.

10 Comments

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10 responses to “Price it, sell it

  1. fred

    dumb builders think they can double dip.
    ie. they get paid salary whence building and then a massive 33% payday when it sells.

    problem is…..a bunch of dumb buyers and real estate agents made it possible in the past.

    As a general Greenwich Rule, anyone who figures a builders cost at MORE than $300-350 max is an idiot.

    • christopherfountain

      Fred, there’s nbothing wrong with charging what the market will bear. Most builders I know have been through enough cycles, even in Greenwich, that they know enough to make as much as they can when they can because they’re going to lose a big chunk of those earnings the next time the market turns. So I hope these guys built some hefty reserves because its a cinch they aren’t earning a salary now, or a premium on their projects. I have less (ok, no) sympathy for the amateurs who thought this was easy and hired a builder to build them a spec project and then after the builder pulled out his profit, tried to add their own profit on top. Stupidity rarely pays and in this case, it hurts.

  2. fred

    dude….please!

    every cowboy with a big wall street bonus was trying to beat the djia with an investment in greenwich re. Whether they were flippin or looking for looking for a 50% profit on development.

    The first order of bus. fo any Greenwich RE is to explain to a prospective buyer, the past 30 year history of the boom and bust mentality that exist’s in your town.

    There were plenty of good local builders who got shutdown cause of the cowboys and the a-holes that supported their folly.

  3. Glan Man

    thanks for enlightening “builder hater” Fred. Show me a builder that takes a salary when building spec and I’ll show you $450 a sf, cost.
    Don’t paint everyone with the same brush whether it be builders, realtors or attorneys, cause that’s dum……………

  4. hedgie

    Last sale and tax info

    Sold 06/13/2005:
    $1,400,000 *

    5,000 sq ft? at $300 is $1.5mm… $1.5mm building cost + $1.4mm lot + $130K realtor taste + $400K interest (just a guess) = $3.4mm total cost – $2.65mm sale price = $750K total loss for 4yrs work…

    Buyer probably got an okay deal

  5. What's the holdup

    Why does it take forever to put away Bernie?

    http://online.wsj.com/article/BT-CO-20090624-711095.html

  6. Loading Rock Neighbor

    If Loading Rock home sold at $2.6 or less (assumng that no one is dumb enough to pay more than asking for a house on the market that long) – what do you think the spec home at the end of Nearwater Lane should be asking? It too has been on the market for what seems like an eternity.

  7. J

    I do not think that house cost anywhere near 1.5 million to build. I have seen it.
    The builder still made a profit on the sale of the home.

    Don’t forget these builders pay interest only construction loans for the build

    Also, the lot is small I am sure FAR didnt give them room to build a 5k sq ft house

  8. Loading Rock Neighbor

    Nearwater Lane may not have sold – but something happened there…a moving truck was out front this morning.