I recently posted a “coming soon” ad on craigslist for a house that I have listed in Berkeley’s Elmwood neighborhood – 2617 Woolsey Street. Within 24 hours, there was a blog post about it which contains some mischaracterizations that I want to clear up.
The writer (Tracy at www.BayAreaHomeGirl.com) has the basic facts right: my clients bought it just over a year ago, 3/3/08 and they paid $1,075,000. The asking price was $925,000. Our asking price now is $950,000.
Then comes the mischaracterizations: She is “surprised” that the asking price today is $25k more than last time. Why is that surprising? Last time, the $925k asking price generated multiple offers (5), all over $1m. In fact, my client’s offer wasn’t even the highest…it just had the best terms. Given these facts, the $1,075,000 sales price was a very good indicator of the then “fair market value,” not the $925k asking price.
Somehow to Tracy, a $125,000 loss ($1,075,000 paid minus $950,000 now asking) “speaks at an attempt to flip, or a remarkable confidence in today’s floundering market.”
Huh? Taking a $125k loss is an indicator of a flip? The refinished floors and updated bathroom she references were in the listing last time. Furthermore, she asks “Even if the house sold for comfortably over its asking price a year ago, is it realistic to expect it to do the same today?
Who said we expect it to sell over its asking price now? We are well aware of the comps—that’s why we are asking 14% less than last year’s sales price, even though the median sales price in the immediate area went down “only” 11.2% during the same interval.
Now matter how you look at it, the seller is taking a huge financial hit, although our reduced commission will lesson the blow some. The economics of our times means some lucky buyer will get the benefit. So it goes.
Brett Weinstein, Broker
Realty Advocates
