Are You Silly or Successful?

I have a good friend, Sandy, who is very well known in the world of real estate.  She has a unique ability to mix the cold hard truth with a smile and a laugh.  A client of hers once told me “Sandy can shoot you right between the eyes with a double barreled shot gun and make you feel you want her to do it again”.

Sandy recently told me this story.  I am sure it is true because it is exactly the way Sandy talks.  Sandy of course is a member of the Reality Real Estate organization.

Steve Seller:         Hi Sandy this is Steve seller.  How are you?

Sandy:         Steve I am great and so glad you called.  Have you been thinking over the price reduction we talked about?

Seller:         I have and I have good news for you.

Sandy:         Wonderful.  We agreed at the time of listing the market value was $625,000.  You agreed that after 30 days of listing at your above market price of $725,000 you would lower the price to $625,000 and sell.

Seller:         Yes I did Sandy.  My wife and I always keep our word.

Sandy:         Good I will change the price in the computer right now and roll out my market price promotion program.

Seller:         Sandy, not so fast.

Sandy:         But you said you agreed to sell at $625,000.  Our listing agreement says you will lower the price from “your” price of $725,000 to $625,000 after 30 days.

Seller:         Yes I did say that.  Yes we will sell at $625,000.  We just cannot tell everyone that is the plan.

Sandy:         Oh you want to be a secret seller!

Seller:         I am not sure what a secret seller is.  I do know I told everyone at the office and our neighbors we would not take a penny less than $700,000.  I got a little carried away with myself and I am afraid I painted my self into a corner.

Sandy:         No problem at all.  If you are serious about selling, you are still going to have to follow the listing contract and change the price to $625,000 because that is where the market is.

Seller:         I am afraid it gets worse.  The wife was talking with her PTA friends and told them we have already rejected $675,000.

Sandy:         Wow.  You do not even want to be a secret seller you want to be a silly seller.  How silly of you and how silly of me!

Seller:         (Chuckling lightly) Yes.  I guess we made it hard on you.

Sandy:         (Laughing aloud) No you did not make it hard on me.  You have given me a big laugh and a great story to share with other sellers who are thinking of being secret sellers or silly sellers or who want to go over the top and be secret silly sellers and never ever sell.

Seller:         We did?

Sandy:         Steve for a moment you really had me believing you were going to be a secret silly seller who would never sell their house.

Seller:         We did?

Sandy:         Of course you did.  You have given me a great laugh and brightened my day.  You almost had me.  For a moment I thought you were serious about being a secret silly seller.  Then I remembered how serious smart and funny you are and I realized you were too smart and too serious and too successful to be so secretive so silly and so stupid.

Steve:         Yes of course.  Of course we are serious smart and successful. We are great believers in being serious smart and successful.  It is the foundation of our family and our business. We are always serious smart and successful.  We would never have it any other way.

Sandy:         Great.  For a moment you fooled me.  You are such a great actor.  You really sounded like you decided to make vanity and ego more important than selling.  You had me believing you wanted to keep your true intentions a secret from the buyers.  Then I remembered you are serious smart and successful and I knew you were playing a trick on me.

Seller:         Of course we were joshing you.  We just wanted to brighten your day with a big laugh.  You know us and how we love to make you laugh.  We are smart enough to recognize the realities of the market.  We are serious about our decision to sell and move on with our lives.  We are dedicated to our family success that means a new home and a new job in a new community.

Sandy:         I knew that.  You sure are a great actor.

Seller:         When will you roll out your market price promotion plan at $625,000 for our house?

Sandy:         Right now.  Thank you for being so smart serious and successful rather than so secretive silly and stupid.  Thanks for the great laugh.  I really enjoyed it.

Seller:         My pleasure.

Sandy:         My pleasure.

Dark Side Marketing

Are you engaged in dark side marketing?   The following is a true story.  In fact the agent that told me the story said he actually had to delete many of the Dark Side activities because while true they would seem unbelievable.

Agent:         It is a great day at Reality Real Estate.  How can I help you?

Caller:         I want to file a complaint with your boss.

Ron Reality:         This is Ron Reality and I own Reality Real Estate.  What seems to be the problem?

Caller:         It is your agent Renee.  She is just terrible and is running our chances of selling our listing.

Reality:         I am very shocked to hear that.  Renee is one of our top agents and has never had a complaint like yours.  Where is your property?

Seller:         468 Maple St.

Reality:         But we do not list that property.  We are not your agents.  Renee does not work for you.

Seller:         That’s right.  Why should I pay you for bad service?  I am keeping the commission.

Reality:         But if we do not represent you why are you mad at Renee and saying such terrible things?

Seller:         Look Renee is an old friend and while we would never pay her we did allow her to show our property.  We told her that if there were an acceptable offer we would discuss paying her for her time but not a commission.

Reality:         We are doing you a favor and you are angry with us?

Seller:         You bet.  Renee showed our house and the people slipped and fell and may sue us.

Reality:         How can we be responsible because we did you a favor and the buyer slipped and fell in your house?

Seller:         Renee did not bring a flashlight or broom with her.  It is all her fault.

Reality:         You are not making sense.

Seller:         We shut off the electricity to save money because no one was looking at the house.  Renee showed these people and they did not see some stuff that was on the steps and the lady slipped and fell.  If Renee had a flashlight the potential buyer would have avoided slipping.  If Renee had swept the stairs there would not have been any dirt and debris on which to slip.  If we get sued you and Renee are getting sued.

Reality:         What kind of marketing are you doing?  The lights are off.  The house is obviously not clean.  You have not hired a realtor.  You are not offering a commission if someone does sell your house.  Is there anything else you are “not doing” to market and sell your home?

Seller:         Yes.  We are not going to make all the expensive repairs Renee and the old agents suggested.

Reality:         Of course I should have known that.  Why?

Seller:         You realtors are all so smart.  You want us to spend our money and make it easy for you to get your money.  Well I will not fall into that trap.  You are going to have to work to get my home sold and get money out of me!

Reality:         Not really.

Seller:         What?

Reality:         We do not have to work to get money out of you.  We are not going to work for you ever.  It is not easy to sell a house and you do not want to protect your own interests and investment. You only want to blame others for your own problems.  You are a Dark Side marketer, figuratively and literally.

Seller:         What?

Reality:         You are a Dark Side marketer.  The lights are off so a buyer cannot see your house.  You will not list your house with a professional agent.  You are not marketing your house.  You will not clean your house.  You will not fix up and maintain your house.  Your house is dark and your energy and ethics are dark.  Even if a buyer wanted to “see” your house it is dark and not “seeable”.  Your marketing plan is so dark nobody can “see” it.

Seller:         But if I fix, clean and polish my house it will cost money.  If I hire a professional realtor it will cost me money.  If I turn the electricity on and clean the smelly refrigerator it will cost money.  If I clean out the vermin it will cost money.  If I paint it will cost me money.  If I throw out the broken furniture and stage the house it will cost me money.  Why should I spend all that money?

Reality:         So you can sell the house and get money.

This story is extreme but not unusual.  Everyday we see houses with Dark Side marketing issues.  Are there Dark Side issues in your marketing program?

Do you Know The Rules for Real Estate Success?

There are a few really big rules you must know and follow for real estate success.  Did you know you learned these rules in kindergarten?

Every few years some psychologist conducts a study and tells us something we already knew.  What always amazes me is that many of the rules are rules we learned in kindergarten.  The rules worked in kindergarten, real estate and in life.

Rule Number One

Sit in the front of the room.  If you hide in the back of the room you are not engaged.  Hiding in the back lets you observe but not participate.  You do not have to be a psychologist to know that you learn more (quantitative) and better (qualitative) when you participate.  Experience is a great teacher.

Rule Number Two

Pay Attention.  Sit up straight with your feet on the floor.   Proximity to wisdom is very important.  Engaging with wisdom is critical.  Doing things half- heartedly will give you half hearted results.  In computer speak it is called GIGO, garbage in garbage out.

Rule Number Three

Listen.  If you are talking all the time there is no time to listen.  If you are not listening you deny yourself the opportunity to learn from others.  Talking is telling others what you know or do not know.  Listening gives you the opportunity to learn what you do not know.

Rule Number Four

Teams have more success than individuals.  A person may be a catalyst but it takes a team to get the job done.  You may think you can do it all on your own but you are wrong.  Teams can celebrate.  Individuals have nobody to celebrate with.  Throwing yourself a celebration party and being the only guest is not a lot of fun

Rule Number Five

Surround yourself with great people.  Everyone has strengths and weaknesses.  Surround yourself with people who have strengths you do not have.  Remember united we stand divided we fall.

Rule Number Six

Be nice.  Learn to play well with others.  People who play well with others do better over time.   Great leaders motivate while pushing people.  Bad leaders punish people while trying to motivate them.

Rule Number Seven

Take time to recharge.  All work and no play make you boring and tired.  Things in motion tend to stay in motion but they also go slower over time.  Everyone needs down time to recharge.  There is a time to work and a time to play.  You need to do both.

Every real estate transaction has many participants.  Each of the players is an important player in the game.  Sellers and buyers often think they are the only important players.  These egocentric people believe all the others must bend to their will.  This is not true.

Many a deal has crashed on the “rocks” of an appraiser, inspector, mortgage officer, debt negotiator or any of the many other players.  Real estate is unique because there are no “bit” players.  All players are important and all players have the power to win or lose the game.

Success in real estate is about getting to yes.  Some use a big stick to get to yes.  Life experience however is to the contrary.  A big stick or very big stick or even a super big stick may get you to yes.  There is always a situation when you find your stick is not big enough.  Kindergarten and life experience tell us that cooperation is a better path to success.

The Best Time For Repairs

Fix it now or fix it later what really is the best time to make repairs.  My father always answered now or later questions with  “yes”.  As a kid it was confusing.  As an adult it was enlightening.

In real estate I always ask sellers what are the advantages in either situation.

Me:         What are the advantages to fixing repairs now and what are the advantages in postponing repairs?

Seller:         If I put off the repairs I am holding on to my money for a longer time.

Me:         Really.  Have you considered you are also holding on to your house for a longer time?

Seller:         What?

Me:         Have you considered that your failure to make your house the highest value in the market has prevented it from selling?

Seller:         I have reduced the price several times and I have offered a buyer’s credit for fixing the hot water roof and for carpeting.

Me:         Those are steps in the right direction.  Why haven’t you just made the repairs?

Seller:         I don’t have the money is a real problem.  My daughter’s college tuition is more important than new carpet.

Me:         Is that it?  How much more money would you free up for yourself and her tuition if you sold the house?

Seller:         Oops I see what you are getting at.

Me:         Have you thought that perhaps the buyer will not have any extra money for repairs and fixing things.  The buyer is going to be able to borrow 75-90% of the total cost of the house.  The buyer will sink everything into buying the best and most expensive house possible.  Rarely does a buyer reserve substantial money for repairs.  The buyer is indirectly asking the bank to “fund” the value of the repairs.

Seller:         Are you saying I am cutting off my nose to spite my face?

Me:         What do you think?

Seller:         What if I put down a brown carpet or paint the walls yellow and the buyer wants a white carpet and beige walls.  If I make the wrong decision I have shot myself in the foot.

Me:         Buyers may not love you choices.  Every buyer I have ever met is willing to live with something new and nice even if it is not their perfect choice just so long as they do not have to put out extra money at closing.

Seller:         I am afraid that if I start repairs I will be opening a can of worms that will cost me more time and money than I have.  I think it is smarter to let the buyer take that risk.

Me:         Do you really believe that the buyer is not concerned about the same issues that concern you?

Seller:         I had not thought about it that way.  I just do not have the money or time.

Me:         I see you realize that you and the buyer are in exactly the same boat.

Seller:         I realize that I have to lower the price so the buyer feels comfortable making the repairs.

Me:         If there is any way you can get the money for the repairs it will be greatly to your advantage.  Crème de la crème homes sell for more money and sell faster than homes that need repair.  It is to your benefit to beg, borrow or find the money for the repairs.  If the items are small many stores and repair people will agree to a partial payment and the rest at closing.  This is especially true if you instruct the title company or closing attorney to make the payment directly from the closing proceeds to the contractor.

Seller:         What if I put the costs on my credit card?

Me:         I would do a very careful cost analysis.  An alternative that achieves the same goal at lower cost is to use a credit card issued by the home repair stores.  Many of these cards offer a grace period and have lower interest rates than regular cards.  You can also anticipate some of the repairs and schedule the repairs or purchases around special sales.  For example replacing an air conditioner is much cheaper in the fall than the summer.  Furnaces and hot water heaters are cheaper in the spring than in the middle of January.

Seller:         I am going to talk with my wife tonight.  We are going to figure this out tonight and begin the repairs as soon as possible.

How to Avoid The Square Foot Trap
The square foot trap ensnares countless buyers and sellers every day.  Buyers and sellers caught in the square foot trap rarely escape.  When they do escape they are always severely injured.  The injuries are financial and emotional and often mean the property remains unsold.What is the square foot trap?  The answer is itself a question.  When is a square foot not a square foot?  A square foot is a function of the person doing the measuring and calculations, the community where the property is located, the rules of any of several oversight authorities, and the desired outcome of the calculations.How is something as simple as measuring and calculating length times width be so difficult?  Measuring and calculating square footage is a take off on the accountant’s joke.  The first accountant asks his associate “how much is one plus one”.  The associate says, “What would you like the answer to be”.Before you can calculate a measurement you have to decide what you are going to measure.  This sounds very simple but it is not.  In cold climate communities a general rule is to measure “heated” space.  If Sam Seller has a heated 2- car garage does it make sense to measure the garage as part of the square footage of the house?  Suppose Steve Seller has engine block plug in heaters in his 2-car garage but does not heat the air space of the garage.  Does it make sense to include or exclude the garage in calculating the square footage of the house? Sylvia Seller has a super insulated garage.  It is warmer than the garages of Sam and Steve but it does not have space heaters or engine block heaters.  Is it fair, wise or make any sense to exclude the size of Sylvia’s garage from the square footage calculations?  Do you place the same value on the “heated” garage as on the main dwelling area?The problem flips when applied to hot weather climates.  The general rule is to measure air- conditioned space.  Hot or cold the problem remains the same.  What should be measured and does it make sense to measure or not measure?When is a patio not a patio?  In many places it depends if the patio is “enclosed”.  If the patio is enclosed it is a patio and may be included in a square foot measurement.  Is a screened patio an enclosed patio?  Does the patio get measured if it is roofed but not enclosed?  It depends on local custom in many areas.In many places a ground floor patio is never included as square footage but the very same patio on an upper level is included.  The most common explanation for this duality is that the ground floor is part of the outside yard while the upper level patio is part of the house.  There are many more patio measurement issues.Mother in law apartments raise many questions.  Does the apartment have direct access to the main house?  Is the connection via a corridor that can be closed at one or both ends.  Is access only available through an exterior entrance?  Does the apartment have some physical connection to the main house? Does a converted attached- or unattached- garage qualify?  Can an apartment above a garage ever qualify?  The correct answers depend on what sate or even what town you are in.Basements are another example of the trap.  How high must the ceiling be?  What constitutes finished floors and ceiling?  Does it have to have windows of a certain size and or a minimum number of windows?  Must there be a walk out door?Dueling governmental regulations regularly produce different square foot calculations.  A friend built a house in an unincorporated area.   The county rules and regulations were crafted to encourage certain designs and to prohibit others.  After many years the areas was incorporated into an adjacent town.  The town had its own building code with goals and prohibitions markedly different from the county.  The official square footage of the home grew by almost 225 square feet.  This was good news in terms of future sales but terrible news in terms of taxes.In many densely populated areas space is super expensive and apartments are sold on cubic foot measurements.  Calculating cubic feet geometrically compounds the measurement problems.A friend had a tiny condominium on New York City.  To enlarge the space the sheet rocked “dead” space above some large closets was knocked out and opened up to become enclosed storage.  The tax office increased the condominium’s official size.  The increase in taxes was small compared to the increase in value because of the additional “space”.  The total space did not change but the usable space increased and the value increase significantly.Appraisal professional organizations and many realtor associations have their own suggestions and guidelines as to what should or may be measured and how.  They also allow for the appraiser or realtor to use discretion.In contested divorces each side hires its own appraiser.  Often the square foot calculation is 10-15% apart!  When coupled with widely different comparables the value differences may be huge.The trap of square footage is easy to avoid.  Pay no attention to it.  Leave behind all you know about square footage.  Look at the overall market to determine how the house you like compares to others you have looked at.   If you get lost in the minutia of “finished” basements, “enclosed” patios, “heated” garages, and mother in law apartments, you will not see the forest because of the trees.  You are buying or selling a home, an emotional expression of materials not a mathematical calculation of the materials. The materials constitute a house.  The way the materials are put together and the emotion you bring to the house make a home.

Real Estate Lessons From Your Mom

For many years I believed that I was the only person whose mom imparted life and real estate lessons.  As I got older I learned that every mom has life and real lessons she imparts to her children.  I decided to ask several of the most outstanding realtors in the world what life and real estate lessons their mom imparted.  These are the most popular mom lessons.

Rule Number One:         Where is it written?  This was one of my mom’s favorites and it turns out this was a favorite of several moms.  When I or my realtor friends went running (crying) to mom about a real or imagined injustice or unfairness we all were met with ”Where is it written?” response.

This is a much more thoughtful response than simply noting that life (and real estate) are not fair.  The ”where is it written” response urged us to seek, explore and learn for truth, justice and fairness.

Over time we learned that life is fair when we choose to surround ourselves with people for whom fairness is an important value.  Soon we learned that if we always surround ourselves with people who share the same values, life becomes exactly as we wish it to be.

I am always amazed when sellers and buyers rant and rave over the unfairness of the market or other sellers or buyers.  There is no point in a buyer getting angry or upset that sellers are asking too much or not lowering prices.  If you are a buyer you have choices.  You can “pay up” or you cannot buy.  If you are a seller there is no point in being upset with buyers trying to “steal” your property.  You too have a choice you can sell and get money or continue to own your property.

Because nobody knows what the future will bring the wisdom of your decision is always determined by hindsight.  Hindsight is about time.  If you choose the right timeline hindsight will assure you have made the right decision. Choosing the right timeline is solely within your control.  You cannot make a mistake!

The lesson is you are in control of your life and real estate.  A long- range perspective will correct all short- term errors.  You can make the world exactly as you want it to be.  “Where is it written” is written in your head and heart.

Rule Number Two:         Achieving your goal IS the goal.   People love to beat the other side.  What often happens is that they win a battle and lose a war.  Many realtors reported mom let them learn this turtle and hare lesson the hard way.  They had many short- term battle successes only to find out that they failed to achieve their goal.

Buyers and sellers often both demand winning every battle.  The battles are fought over price, terms, conditions and the extras.  Each side invests huge amounts of emotion, energy and intellect into winning.

If one side “wins” too many battles, the loser fears total defeat.    The only option for the “loser” is to withdraw from the battle in order to live and fight another day.  The result is neither side reaches their goal of selling/buying the property.

Rule Number Three:         Win win is the only way to “win”.  Somewhere deep within our psyche is buried a message that we always have to win.  Perhaps it is a hard wire of our brains from cave man days.

Experience teaches that buyers and sellers usually have much more common ground than disputed ground.  Recognize what is very important to the other side and do everything you can to give them a win.  The law of reciprocity will work to help you achieve what is important to you.

A rule in poker is to “know when to hold them and know when to fold them.”  It is the same in real estate.  Almost every realtor reported that mom imparted a win- win philosophy as a key to life and real estate success.

If you follow mom’s real estate rules you will find your real estate transactions are positive successful experiences.

Is Your Real Estate Brain Frozen?

Cryogenics is a booming business.  In real estate having a cryogenic approach to buying and selling will lead to disaster.

People have always wanted to extend their mortality to cheat or postpone eternal death.  Scientific break throughs have resulted in many small steps that may lead to a truly successful process.  Simply put cryogenics freezes tissue to temperatures near absolute zero.  The hope is that in the future the tissue will be brought back to “life”.

Many sellers and buyers take a cryogenic approach to their real estate dreams and aspirations.  It is understandable human nature to always believe that your personal economics will get better.  We all like to think that we are smarter than the next person and that our insights are better, clearer and are true and correct.

By definition most of us are average rather than being smarter, sharper, clearer, true and correct. If we are all special none of us can be more special.  Applying “special” thinking to your real estate wishes is usually disastrous.

Buyers rush into the market when it is very high.  Everyone one of those buyers believes the markets will continue their meteoric advances.  Many are convinced the rate of appreciation will actually accelerate.

In hot markets sellers often think like the buyers.  The sellers put outrageously high prices on their properties.  The sellers believe that even if the price is outrageously above the market it will only be a matter of a few weeks or perhaps a month or two when the market “catches up” to the price.

The reality is that when greed reigns supreme the greedy become even greedier.  Sellers keep raising prices and buyer keep chasing the market up.  One day the bubble bursts.  There is always a day when the bubble bursts.  It does not make a difference if the market is real estate, stock or bonds or tulip bulbs.  One day the market is up, up and away and the next day there is no market.

Cryogenic sellers and buyers who bought near the top of the market are certain the burst bubble is simply a minor market correction.  They are sure the next day headlines will announce the return of greed and sky rocketing prices.  It does not happen that way.

When the bubble bursts it cannot be put back together again.  It always takes a very long time for a new bubble to form enlarge burst and restart the cycle.  The cycle in real estate is usually between 15-20 years!

Waiting decades for something to happen is a very expensive proposition.  Waiting for decades without any assurances that history will repeat itself in the exact manner you wish it to repeat is a form of insanity.

Cryogenic brain freeze in real estate happens in down markets just as often as it happens in up markets.   In down markets brain freeze infects sellers and buyers.  The most obvious form of brain freeze in buyers is the notion that the market will continue to fall.  Infected buyers are sure that if they wait another 6-12 months they will be able to buy their dream home for 10% less than the current price.

For buyers the issue is compounded when they refuse to recognize when the market bottoms or moves up.  No matter how solid the market correction is the cryogenic brain frozen buyer is sure that recession if not depression is just around the corner.

The cryogenically frozen brain of a seller in a down market is certain the market is turning up tomorrow.  No matter how long the recession or depression, no matter how deep the economic malaise, the brain frozen seller “knows” the market will turn tomorrow and skyrocket up even faster than it fell.  This is a nice hope but has no basis in reality.

Markets are about what is here today and possibly might be here tomorrow.  Nobody knows what today will bring.  No body knows what tomorrow may bring.  Thoughts of the future are guesses.  They may be good guess even great guesses but they are still guesses.

Choosing to risk your family harmony and well being on a guess is not wise.  The symptoms of a cryogenic brain are obvious and numerous.  They manifest as an absolute assurance the future can be foretold.  If you feel a real estate brain freeze coming on quickly call your friends at Reality Real Estate. Large doses of reality can melt even the worst brain freezes.

Real Estate Pugilists

Great realtors know that bringing the buyer and seller together will often produce fighting words.  This is a true story that provides many valuable lessons if you are willing to learn.

Steve Seller:         I am Steve Seller.  Thank you for coming to my house.  I hope that you will buy it.

Barry Buyer:         Well it is a nice house and I am looking for a nice house.

Seller:         Great it is yours for $759,000.

Buyer:         Wow Steve that is a lot of money.

Seller:         Are you kidding me?  It is a great buy.  I paid almost that much three years ago.

Buyer:         So what.  What have you done to fix the house up in the past three years?

Seller:         Barry, I painted the baby’s room, put in energy efficient light bulbs, seeded the bare spots in the lawn, and put up a new mail box and house numbers.

Buyer:         Steve that does not sound like a major investment.  Just how much did you pay three years ago?

Seller:         It really is none of your business.  The value of the house today is what is important.

Buyer:         You are right.  Give me a moment and I will access the county records on my phone app and get the price.  Wow Steve according to the county you only paid $675,000 in 2009.

Seller:         Maybe that is right.  But I did make those improvements and we also replaced a window air conditioner.  That was a couple of hundred.

Buyer:         I do not want to be ungrateful but you did not add anywhere close to $$84,000 in improvements and the values in this area have dropped 10-15% the last few years.

Seller:         Well the values may have dropped a little.  Whatever happened here is better than in most areas.  That is proof that this is a very desirable location.  In real estate location is everything.

Buyer:         You are right about location.  I am right that values have gone down and not up.  Down by 15% is not up by 12%.  Even without walking through the entire house you are over priced by 20-25% maybe more.

Seller:         Who do you think you are Mr. smarter pants buyer?

Buyer:         I may be a smarty-pants buyer Mr. Stupid seller.  I also have been in 20-30 homes in this neighborhood all of which offer far more value for the money than you are offering.

Seller:         Well I have lived here for three years and my neighbors have told me it is my duty to hold up their values.

Buyer:         I believe you and I have gone into their houses and those same neighbors are offering more than you are.  They are undercutting your value.  How did you come up with the asking price?

Seller:         I did what all sellers do I figured out how much money I needed.  That is what sellers do.

Buyer:         That is what sellers who never sell their homes do.  Sellers who are serious about selling calculate the price that means they are offering the highest and best value in the market.  Those sellers sell the rest never sell.

Seller:         That is ridiculous.  If I focused on value I probably will not get the money I need to pay my bills, send the kids to college, start my new business and buy my next home.

Buyer:         Well that is your wish list.  To be honest buyers never care about the needs and wants of the sellers.  Buyers care about their own needs and wants.  In that regard buyers and sellers are exactly alike.

Seller:         Well that may be true but I cannot be concerned about you.  I have to focus on my family.

Buyer:         Focus all you want.  I understand your position.  I am focusing on my family as well.  I would be happy to buy your house today for  $595,000.

Seller:         You are crazy.  You are cheating me.  That is outrageous.  Get out of my house immediately.

Buyer:         I am not crazy, not a cheat and I will leave and go buy your neighbor’s house.  The market puts a value on your house.  Your neighbors, other sellers, other buyers, lenders, appraisers, inspectors, all the players in real estate contribute to determining value.  $595,000 is the fair market value of your house today.

Seller:         That is what the people at Reality Real Estate told me also.  I told them to fly a kite.  I had an appraisal done and it appraised for $597,500.  I told the appraiser to fly a kite.

Buyer:         Did you get a pre inspection?

Seller:         I did and there were only small repairs and stuff.

Buyer:         How small?

Seller:         Just under $9,000.  It was all small stuff.

Buyer:         Great.  I will take off for the repairs and revise my offer down to $585,000.  Take it or leave it.  It is not about me it is about the market value of your home today.

How many lessons did you learn?