Sellers Medical Alert

Sellers Medical Alert!!!

A Bonaire Day

Notice to all sellers of real estate, please take notice, there is an invidious illness sweeping the real estate market.  The illness may cause temporary deafness, blindness, memory loss and in extreme cases moments of delusion!  The illness can result in financial ruin.

The illness can strike sellers at any time and anywhere.  It does not respect age or gender.  Your physical health is irrelevant.  The illness is often transmitted by or supported by hopeful real estate brokers who are often suffering from the same infection.   There have been reports that the disease has spread from sellers to agents and agents to sellers.  In many reported cases the disease goes back and forth between seller and agent reinfecting each other many times with an ever more virulent infection.

The disease is called The Market Does Not Apply to Me Syndrome (MarketDNAS often shortened further to MDNAS).  MDNAS is rampant throughout the world right now and is at epidemic proportions in Europe and America.

There is no vaccine for MDNAS.  No amount of bed rest, hot tea or even chicken soup can cure MDNAS.  The only preventative/cure is a constant dose of market reality.  The reality dose in severe cases has to be administered by a skilled true professional agent as often as weekly and often for many weeks.

Here are two recent case studies of MDNAS.

The Case Study of S.P.:

S.P. was an acquaintance 30 years ago.  Before retirement he headed an extremely successful marketing agency.  His company did business throughout America and had many blue ribbon clients.   S.P. was a very well respected businessman.  He was always a realist.  Well, always a realist except in real estate.

S.P. bought a beautiful vacation retreat property.  S.P. built a drop dead beautiful home on the property.  About 8 years went by and S.P. called and said, “I might be interested in selling, come and tell me what the property is worth”.

We did a very through in depth market analysis and even arranged for an independent appraisal.  The appraiser and I both arrived at the same price range. $2.2-2.4M.  S.P. was thrilled as that represented a big profit.  S.P. decided not to sell; he was going for the jackpot.  MDNAS had struck S.P. very hard.

A few more years passed and history repeated itself.  This time the appraiser and I thought the value was $2.4-2.6M.  S.P. was disappointed, he wanted even more.  I cautioned him that the market was showing many signs of peaking.  Once again MDNAS struck.

In late 2006 after the market had clearly peaked, S.P. called again.  The appraiser and I agreed again but at a lower price, $2.2-2.4.  S.P. was very upset with us.  He said another real estate agent promised $3.9M “as a sure thing in six months or less.”  MDNAS hit S.P. and the other agent very hard.

Almost 5 years have passed.  Over the weekend I received a call from S.P.’s agent that the situation was desperate and S.P. would sell for $2.0M.  Of course S.P. and the agent are still suffering from acute MDNAS because in his part of Florida $2.0M homes had devalued 25-35% since 2006.  That meant that ALL similar houses including S.P.’s had devalued by 25-35% in the past 5 years!

If S.P. takes the reality cure for MDNAS he can still sell his house and make a profit.  If he had taken the reality cure at any time in the past 10 years he would have made a big profit.  If he does not take the cure immediately, he may lose his investment.

The Mysterious Case of the Over Priced Purchase

M is a delightful person.  M. is intelligent, confident, and worldly.  In 2005 MDNAS suddenly hit M very hard.  People she thought she could trust befriended M.  M’s new found friends convinced M to buy their beautiful condominium.  These “friends” even convinced her to “save” the expense of a professional agent.  Who needed an agent when buying from “friends.”?   M bought and paid $75,000 too much and bought at the top of the market!

M now comes to me and says,” I will sell at the price I paid and not seek a profit.”  MDNAS has struck M very, very hard.  I arranged for 2 independent appraisals.  Both appraisals agreed with my market evaluation.  Three professionals agreed that the value was the same and significantly below the value in 2005 plus the $75,000 “overpayment.

The bank that holds M’s mortgage addressed the situation as well.  Sadly, MDNAS has caused M to suffer a severe hearing loss, blindness to the economic reports in the papers, and memory loss of what is really happening in the world.

It took M 8 more months until she realized that she was suffering from MDNAS.  M is now taking a weekly dose of the reality cure.  M is making good progress and is expected to have a good recovery.

Markets go up and markets go down.  Markets are affected by hundreds of factors, economic, political, social, geopolitical and more. In our hyper-connected world events that 30 years ago would not have affected our markets today have an immediate and material effect.

The last few weeks appear to be a repeat of the world- wide economic disruptions of last Spring.  The Euro and Dollar are bouncing all over.  The Euro banking crisis again is raising its ugly head in the PIGGS, Portugal, Ireland, Italy, Greece and Spain.

The economy in America is very slow.  The economy in Holland shrank slightly in the last quarter.  Real estate in America and the EU is much slower than their overall economies.  China’s currency manipulation is threatening to end “free” trade.  The list goes on.

Nobody ever fights MDNAS and wins.  Nobody ever fights to a draw with MDNAS.  It is a terrible disease, which always debilitates and causes harm unless and until you take the cure!

Contact us today for your free inoculation against MDNAS.