Let's make a list of tricks sellers (and realtors) will be playing to move properties.
I for one have done the list it too high - then pull it and put it out at a more reasonable price (and fresh days of listing) trick
I've also liked to put it out too high and then reduce - shows motivation to sell. However, the trick is, put it out 20% above what it should go for, then reduce down to 10% above.
Then we see the builders offering free cars, $100,000 off, free plasma TV's, and one joker in Phoenix offering "wine lofts" complete with $560 wine coolers.
If you can get some fish to buy for a $560 wine cooler, one word. Genius.
List your tricks here (or ones you expect to see during the downfall)
February 13, 2006
List o' Tricks
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My sister reports that landlords in Las Vegas are starting to force people into lease options. When looking at a place that she thought was "just for rent", in a bait-and-switch maneuver the landlord began to hard sell a lease option with a massively overblown price of $365k for the tiny townhouse. Then he told her if she didn't sign that day the price would go up to $370k, and would continue to go up $5k a month. That happened to her twice while looking. Fortunately, she found a place that wasn't trying to upsell the extra lease option payment, which would have been wasted anyways.
In the face of desperation, these landlord investors are getting pretty clever.
Shills always work. Shills are forbidden if you're bidding for a $10 baseball card on ebay, but if you're bidding on a half-million dollar house, you should expect to be bidding against ghosts.
Antidote:Courage and knowledge that there are other houses out there, and there will be more as time goes on.
Playing the emotions, wife against husband, boyfriend against girlfriend. "I can tell she loves it, why don't you sir?" {undertone is are you too cheap?} It works with flowers ($30 wilted tulips and $100 roses are selling out here today, as are $300,000 apartments in bad neighborhoods!)
Antidote:Talk to your partner ahead of time, reassure one another that you won't be buying a home. You will buy one of the thousands (and growing) number of houses which you two can make into a home.
Technique:Fear. You'd better get on the property ladder now, or you never will."
Antidote:Politely (optional) tell the estate agent to get lost.
Walk. Some of the best offers you'll ever get will be made to your back. For optional effect, ask "Have I told you to go f@ck yourelf?"
AnonyRuss
I have to give some credit to the MLS people for putting an end to the re-list and re-set the days on market trick. Now, at least in the Phoenix area system, any house that has been listed in the previous 90 days will not be re-set to zero when it is listed again. Of course, you can always wait 91 days, but that is a nice penalty.
As for other tricks, I find the Home Warranties fairly useless. The house is great, but this will cover you when everything falls apart after closing. I noticed so many limitations on one that a family member had for a year, that I deem them fairly useless. I will just pay less if the air conditioner is on its last legs.
And please, enough about the wonderful tax deductions. Yes, if you itemize and can deduct interest, do so. But do not go out of your way to gain the honor of paying the bank 30 grand to avoid paying the government 10.
If I was a landlord, I'd be desperate to get lease options signed with a locked value too. That is if I couldn't break even selling.
1. "Lot's up pent-up demand out there - never a better time to buy at a bargain price. Maybe your last chance. Interest rates are going up. I'd hate to see you fail to qualify for the one you really want because of higher borrowing costs."
2. "I'm going to have to reschedule the showing of that property you inquired about. Seems there are three other couples looking at that one that day."
3. "When you rent, you are just throwing your money away to your landlord. He gets to deduct the mortgage interest that you paid for him in your rent. When you own your own home, you get to deduct the mortgage interest on your taxes." (Just curious - how many of these subprime, interest-only, ARM borrowers itemize on their tax returns - or even file a return, for that matter?)
4. "I live in this neighborhood."
5. "I thing the sellers might consider an offer of $5,000 less than the asking price."
6. "This is a former model home."
7. "This floorplan has been discontinued by the builder. There will not be any more like this one."
8. "They're not making any more land."
9. "The schools in the area are top-rated."
10. "If you buy today, we'll throw in a couple of trees for free. Just our little way of saying 'Thank you'."
Three young college freshmen at a prestigious university were sitting aroung shooting the breeze, getting acquainted. The topic of what their fathers did for a living came up. "Mine's a doctor!" said one, proudly. "My dad's a teacher." exclaimed another. The third refused to say at first, then finally said "My dad plays the piano in a brothel." The others could not believe such an outlandish tale, and kept prodding him to tell the truth. Finally, they were able to get him to admit the shameful truth. His father, he finally said, was really a real estate agent, but he was just too ashamed and embarrassed to admit it.
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