Ever since the 2008 financial crisis, real estate’s been on a bizarre roller coaster with just as many crazy ups as downs. But whether a place takes days, months, or years to sell, you can bet that passions run high, negotiations are tough, and compromises are far and few between. Learn what really counts in cutting a deal today from our savvy brokers.
What are you seeing on the sales front?
LAURA RUBIN DRESNER: In general, sellers are emotional and upset because they aren’t making money in real estate like they used to. And buyers expect perfection because they feel like they’re stepping up to the plate in a tricky market. So they’re asking for repairs and credits. Yet sellers don’t want to put any more money into something that they’re already losing money on.
NATASHA MOTEV: I’m seeing the same thing—buyers are looking for perfect houses at really great prices, and that’s a problem because inventory is so low right now to begin with. So to sellers, it’s unrealistic.
So they’re picky and wary going into the game?
LRD: Yes, or in many cases, totally scared. It used to be such a liquid market, so they were okay because they knew they could sell and get out. Now, before we put the offer in, I discuss exit strategies with my buyers— especially on luxury properties.
NM: Now, it’s a really long-term commitment because you can’t exit easily with profitability.
How do you quell your buyer’s fears?
LRD: I educate them about the tremendous value they’re getting. Luxury properties have a high level of quality in terms of their construction, materials, and aesthetics. Often, it would take years and extraordinary funds to replicate all that, and they need to realize that they’re purchasing these properties for much less than replacement value.
And if you’re representing a seller?
LRD: It’s the same story. Education is key. I consistently have to make them understand that the exorbitant amount of money that they put into the design and finishes won’t necessarily translate into dollar-for-dollar returns.
So you’re basically dispelling unrealistic expectations on both sides?
LRD: Exactly and always. And it often pays to head things off at the pass by using the right professionals. For instance, you want an inspector who’s able to recognize the difference between a five-alarm fire and a smoke signal.
Sounds like it takes a lot of hand-holding and psychology.
LRD: We have to be full-service, knowledgeable, and emotionally astute. I guess my psychology degree came in handy after all.
NM: And have a good resource list. After all, you’re only as good as the people on your team.