Sunday, May 23, 2010

Back in Shidduchim--Selling a House

Our house has been on the market for what will be a year the beginning of July. People warned us, including our real estate agents, that this is a bad time to be trying to sell a house, thanks to the economy and the job situation. Still, the house had to go on the market because we are serious about making our move to LV in what we hope is the near future. During the time the house has been on the market I have come to realize more and more that shidduchim and selling a house share the same modus operandi.

First, the "product" goes on the market when IT is ready regardless of what else is happening in the outside world. When outside conditions are not at their most favorable that "product" may sit around, still looking for buyers. After all, it only takes one to make a "shidduch," and there is every reason to believe that shidduch is out there somewhere. As the Lottery says: "You've got to be in it to win it."

Second, you spend a lot of time "dressed up" in "dating clothes" that should appeal to the type of buyer you are looking for. You are constantly doing "make up" touch ups, adjusting your hair style, maybe getting new "shoes" that will make the total look appealing. Yeah, and maybe doing a little cosmetic surgery to get that look just right. It doesn't matter if the shoes pinch or you can't do what you really want to do when you've got that "date" with someone. (And the same way that men and women may agonize over a perfume or cologne that will smell just right without being overpowering or sending the wrong message, you have to have seen us with the house deodorizer hunt until we found one that said "homey and sophisticated" both at the same time.) And then they walk in the door and you start the conversation and you know 5 seconds in that this is not a shidduch, but you continue the date anyway, because just maybe this person might know someone who would be right for you, and you're not about to burn your bridges.

Then there are the financial questions that keep popping up. You've told your "agent" precisely what you want, but in the back of your mind, particularly after you have been dating for a while, you also have the figure that you would be willing to accept--below that figure you won't go. And then people chide you for your decision. And some people offer a price so far out of the ball park that it's on a different planet altogether. And yes, there are some people that want that "shidduch" so badly that they change their pricing structure and take whatever they can get. Some of them are happy in the end; a whole lot aren't.

One thing for sure: let us have something that we must be doing, that is going to require all our time and attention, and the "shidduch dates" start piling up in droves. It's post-Shavuous, post-Shabbos and pre-final exams and the end of the term for me. If I had nothing else to concentrate on but school I'd be busy 60 hours a week for the next few weeks. So of course the calls are coming in to make a date to see the house. And as everyone out there will tell you, it's verboten to say "I'm sorry, I'm busy, could we make it next week."

Another parallel with dating: we've told our agents what our sell figure is. They've seen the house from top to bottom. They've taken pictures of the house for prospective buyers to see before they make an appointment. And yet...we've had people who show up who in no way, shape or form want what our house is or can afford the price. Some of these people seem to be house viewing junkies; they know they are supposed to be looking for a house so they make appointment after appointment to see houses that aren't a good fit for them, but they seem to have these high blown hopes that the house will somehow miraculously morph into their dream home by the time they arrive. And then they complain that there is nothing out there for them.

While I'm generally satisfied with our agents, they, too, sometimes act like many shadchanim do, redting a shidduch that they know does not meet the requirements of the buyer or of the seller, but hey, you never know.

So yes, home sellers and those looking for shidduchim have an awful lot in common. It seems sometimes like no one is listening when they say what they want. Some of the dates are clearly not shayich and should never have been redt. And yet, what we also have in common is the hope and dream that some day "Mr./Ms. Right" will be standing on the other side of the door. That old saw is right: You have to kiss a lot of frogs before you find a prince.

You'll have to excuse me now: our house has a "date" this afternoon and it needs me to put on the finishing touches to the dating outfit. And wouldn't it be nice if this were to be the right one and I'd never have to do this again.


Anonymous said...

I'm sure you realize that the market sets the price of a house. Whenever I hear someone say they can't sell their house, I quietly say to myself "they can sell it, but not for the price they want to get".

aFellowSeller said...

There's a lot the two activities have in common but there is one really big difference also. When you go to buy a house you always have in mind that if there are any things you don't like or that don't fit your style or colors, you can always change them later. Most people are going to make changes to their homes over the years including some really major ones. But it can be a bad situation for someone who is dating to say to themselves that they don't like X,Y or Z in a person but they will change them once the marriage happens. Unlike with a house, you can't be sure that you're going to be doing any remodeling after the marriage. Maybe the color of someone's neckties or something like that but not a major makeover.

Offwinger said...

Anon @ 11:33,

Yes, the market sets the price of a house. What you're missing though is that right now, the current inventory far exceeds the number of buyers. There simply is NOT 1 buyer for every seller, and there isn't much financing to allow investors to purchase multiple houses either. This backlog of inventory is going to take a while to catch up, particulary due to tightened lending standards and the number of houses still held by banks in foreclosure but that have not yet not placed on the market at all.

You are correct that some sellers refuse to recognize that their house is only worth what someone will pay right now for it, not what you paid or what it might have been worth 5 years ago. At the same time, the reason the sellers can't sell may not have very much to do with the price they set their house at. If every seller reduced his/her asking price by $50,000 or $100,000 or whatever, there STILL would not be enough buyers with the money or financing to purchases these homes.

Anonymous said...

Good luck with the sale. Just remember that if you sell for want you want, it also probably means you will be able to buy your new home in LV for less than that seller wants to get. If you wait for the market to rebouod here, it also might rebound in LV.

Anonymous said...

I once heard from a very clever person that there is no such thing as a bad market, there's only a wrong price. In other words, in a free market, the value of ANYTHING is exactly the amount a buyer (with his/her free will) is willing to pay for the item from a seller (with his/her free will).

So when something languishes on the market for a period of time, it means that the seller hasn't really decides to sell it yet, and is deciding to wait for willing buyers to appear at the desired price. Basically, it's tradeoff (that doesn't always work, obviously) of time versus price.


Allen said...

The question of price comes into play only if you are under a deadline to leave NY. If you have to be gone by a certain date then you end up taking whatever the market right now will give you. If you have time to wait it out and see if prices will swing up somewhat then there's no reason to settle this soon. Today it's generally thought that it can take 18 months or more to sell a house in a higher priced area unless you are willing to go way down in price.

And as Offwinger mentioned, sometimes it's not even the price of the house that is the problem but the inability of buyers to get the loans they need. You could always try and ask your agents to send you only pre-approved buyers in the loan range that your house will cost. Might get fewer lookers but those that will come will at least already have proven that someone will give them a loan if they like the house.

Lion of Zion said...

"or can afford the price"

buyers' assumption (and certainly true in this market) is that sellers inflate the asking price because they know they will be bargained down (no different than buying a car, etc.). my understanding is that a buyer's first offer is typically ~25% below asking price.

also, some of the buyers' behaviors you detest are in part shaped by scumbag agents (yeah, a stereotype).

good luck!

JS said...

My wife and I bought our house last year. So, maybe the following advice, from a buyer's perspective, will be helpful.

Whether the housing market is improving or not, there is still the perception that it is a buyer's market. Therefore, it is likely that any buyer that is even remotely interested is going to put in a bid that is WAY below the asking price. We placed our initial bid about 15% below the already low asking price figuring we had nothing to lose - houses aren't moving and if the seller says no we'll just wait for the next house, we're in no rush. My advice on this front is not to just dismiss a bid out of hand, but come down a bit and see if they're serious.

A house that is on the market for a long time (and a year is a REALLY long time) starts to reek of desperation. Realtors (and smart buyers) can see how long a house has been on the market. This creates a perception that you are desperate and will take a lower price so you're more likely to get really low ball offers. Some people de-list and then re-list the house so it looks like a new listing to people who don't know any better.

It really is true that regardless of market, a house will move for the right price. If you want to wait and not lower the asking price, I'd suggest just de-listing for a while. Having it languish on the market does you no favors.

Assuming the price is good, you should ask yourself why the house isn't moving. Yes, you'll get a bunch of people just looking who aren't serious, but if there have been serious potential buyers, try to take an honest assessment of why they are turned off. If it's not price, you should consider whether anything you've done to the house in terms of decor, paint colors, or anything else is a turn off. Lots of buyers lack imagination and fail to see they can change the house. Some also may lack the funds to change a house and don't want to be "stuck" with a certain look.

Also, it may be silly, but simple stupid things can turn off a buyer or make him feel he can demand a lower price: lights that don't work, faucets that drip, etc.

Finally, remember it soon won't be your house anymore so it doesn't hurt to repaint in neutral colors or do other cheap renovations that have a good return on investment.

Good luck.

Offwinger said...


The 25% less thing seems to me to be a NY metro kind of thing. There are other regions where this expectation doesn't exist. In some regions, anything more than 10-15% less is viewed as "not a serious buyer," and buyers won't search for houses listed at 125% of what they can afford, because they don't reasonably think they'd be able to negotiate an agreement anyway. That's why listing at the right price matters so much. If you inflate too much (predicting a huge discount), some buyers may not even catch your house in their search. Bottom line: it's about knowing the LOCAL market customs and expectations in pricing & negotiating.


Your comment about de-listing is wrong, because websites like zillow and others now let people see listing/re-listing histories. So you can't pretend a house is new on the market just be de-listing and re-listing or by reducing the price. FWIW, I think this is healthy. More data is good, and it will help reduce the incentive to play games like that. The stigma of "been on the market for a year" will slowly ebb, once people recognize how many fine houses are languishing simply due to the increased inventory available.

One last thought on pricing:
I have friends who listed and sold within one week. They had one open house and got a buyer immediately for virtually what they asked. How come? Well, first of all, they priced correctly for attracting offers. Second - and maybe more importantly - they are at a unique price point in their neighborhood. Their house was the best condition house in the "starter home" price range (not many exist in this area) listed in that time frame. Third, they did it during the tax credit time period.

They were glad it went so smoothly, and they aren't really kicking themselves about "maybe we should have asked for more." But of the three factors involved that all went right for them, only one really had to do with them & pricing. The other was about the house having a unique quality and the other was taking advantage of a subsidy for home sales.

JS said...


Yes, very true. I said "Some people de-list and then re-list the house so it looks like a new listing to people who don't know any better."

You'd be surprised how many people "don't know any better." You'd also be surprised how many agents simply don't care enough to help out their buyer clients or perhaps hope the buyer will pay more so they get a larger commission.

When buying or selling a home, knowledge and data are key. We got a significant deal on our house because we had a huge information advantage over the sellers. There is a wealth of publicly available information out there for free or minimal cost that can give you a substantial advantage in negotiations. It is not hard to look up how long a house has been on the market, price reductions over time, what the seller (and neighbors) paid for the house, the size of the seller's mortgage, any refinances to the seller's mortgage, sale figures in the area, and getting quotes from contractors for how much something actually costs to fix (if the seller believes it is more costly to fix you can play this up). Point is only savvy purchasers/sellers will acquire this information - none of the realtors we met with offered anything but cursory information. The realtors are out to make a buck generally, not to give you the best advice.

You can also sometimes use the purchase price to immediately get a reduction in property taxes if the house is currently overvalued. Again, this can be used in negotiations in telling the seller the price needs to be lowered given the high taxes.