Can your offers get better over time?

[powayseller]

Here’s a personal question: how often does a seller get progressively better offers over time?

We listed our house at $780K – $830K, and had 2 offers at $780K. A third potential buyer asked if we would consider less than $780K, and I said No so she left. We took the $780K offer.

Neither buyer would negotiate. The first buyer walked when we countered. The second buyer had a cover letter stating “Firm and final offer, don’t bother to counter”. We countered at $800K, and their realtor called my realtor and said that if we counter then they will walk away from the offer and make an offer on one of the other 2 houses that they like. I convinved my husband that rising inventory was working against us, and that they were serious, so we took their offer.

My husband is convinved that we should have persisted on the counter offer, because there was no other house nearly as nice as ours for that price, and the people would have ended up paying the $800K he wanted, because our house was worth it. If they had walked from the offer, we should have held out for another buyer who would pay the $800K.

In a softening market, has it happened that buyers who turn down a reasonable offer are later rewarded by higher offers? How likely is this to happen? Were we foolish to take the $780K?

I still believe that future offers would have come in lower. The other 3 houses for sale at that time in our area are not sold. Two are off the market, and the 3rd has a reduction. All 3 were on sale since last summer I think.

I am seeing firsthand how emotionally attached sellers are to the valuation of their homes. This is still a sore spot for my husband. I think he would feel a lot better about selling the house if he was sure we sold for a good price. He is really second guessing himself on this one. Any feedback based on experience would be appreciated.

[Drew]

Hey PS,

So I have kind of a left-field question. When my wife and I were in the consideration phase of selling our current home (which we just sold), I was looking at a few homes and lots in the Poway/Lakeside split where your previous home was located (I believe you mentioned that being the area?) Actually the house that we were seriously considering making an offer on was on the market for about a year and just recently disappeared from the ziprealty.com listing. It was listed at around $800k, then raised their asking price to $810k, then dropped it to $780k. I’m guessing that this as their feeble attempt to fend off low-ballers? Luckily I stumbled across this site before making a foolish move 🙂

That said, it is a beautiful area and we’re still considering either building a home up there, or purchasing an existing home if the price is right in a few years.

Anyhow, there were two questions I could never seem to get a straight answer on.

1. With each house having its own well, how plentiful is the water supply in the area? I ask because my parents live in a rural area of the NW (Seattle area) and they regularly run their well dry in the summer months. My initial thought was that if it happened in the rainy Northwest, then it must surely happen here.

2. Insurance for fire coverage. Exactly how much is it in a rural area like that? Especially one that was recently ravaged by the Cedar fire.

[powayseller]

We had the best well in the area, because every single property drilled a new well in the first two years we were there. After 4 years of droughts, our water level dropped 80 feet and we drilled ours deeper and added a chlorinator for $8K. Many others spent $40K on theirs. The water gods were smiling on us and I’m grateful. We put in a 10K gallon water tank and outside water filter, so we had better water than the City can provide. Tasty clean water. The chlorinator kills iron bacteria, a nuisance as it makes the pipes sludgy. Not a health hazard. Out there, you need your own water treatment system.

If you buy a property with a well, pay a lab to get the water tested, and a driller to test the water depth and flow rate. Our buyers didn’t and trusted me. They were lucky. They could have been easily led down a costly path. Several neighbors had water trucked in, at $1/gallon. Yikes. Think about how much water you use, and it was easily $700/month for water. Some drilled in several locations before hitting water, at $10K – $20K/attempt.

If you build, factor in the cost for a fire truck turnout ($25K) that your builder won’t tell you about necessarily. Mine didn’t, and the money we had put aside for the solar energy system went instead to the driveway. Many costs to being in the boonies…

Insurance: ZC Sterling did not cancel us or raise our rates after the fire. Farmers, etc. charged people $2500/year for $800K home, before the fire. I paid almost half that. My buyers found insurance, but not ZC Sterling. Many pulled out of that area. I don’t know who they are using.

Which home were you considering? Did you look at my house on Rio Maria Road?

[rankandfile]

I’m sorry I can’t give you personal experience from selling a home, but as an outside observer, it seems like you did the right thing and made your decision based on all the factors involved. Sure, it would have been nice to hold out and make $20K more, but that would have been very risky. The price of homes in that area have appreciated 2.5x in the past 5 years or so. Be thankful you did not succumb to emotion (or buyer’s stubborness) and sold while the selling’s not as bad.

PS: Would it be rude to ask for the address of the home you just sold? I’d like to check it out on Zillow.

[MANmom]

Powayseller, I find it hard to believe that your husband is upset over $20,000 on a $780,000 deal, that is a very small percentage. If you wanted $800,000, then why list a value range at all? That value range BS worked in the hot market with low inventory, but if I as a buyer saw several properties in a day I probably would offer the low end of the range on the property I liked best, but have several others that I liked almost as much for backup. There are more properties out there that would suffice for me. The only buyer that would offer full price is someone for which your house is the only house they really want, for which no other house would do. With plenty of inventory, value range pricing just hurts the seller in this market.

[powayseller]

I agree that value pricing is stupid. We had a unique home. I think we were about the only brand new house in the Poway school district on 5 acres with ocean view and under $900K. The point of the range is to show up in the MLS for people searching up to $799K, so they’ll come out to see the house. Once they fall in love with it, you negotiate with them for the higher price you really want.

It’s more of a point of pride/ego to get the full amount. This is the problem that the 22,000 sellers out there all have. Sellers’ ego prevents them from listing at market value. They are emotionally attached to their homes and don’t want to “give away” even $5. It’s crazy, I know. I am thrilled with the price we got, but only because I believe the future offers would have got lower.

[sdrealtor]

If you are thrilled with the price why were you on JimtheRealtor’s site questioning whether you sold too cheaply yesterday? You did the right thing and got a great price. Stop questioning whether you could have squeezed out another $10K and be happy with the huge profit you realized in cash.

[UP IN ARMS]

“I think we were about the only brand new house in the Poway school district on 5 acres with ocean view”

I’m sorry but I could not sell that no matter what. That may been easy for you but there is no way that once I was in something like that, that I could up and leave. Not sure in Poway how far down 5 acres with view could go down to. Score great deal later more inland but damn 5 acres in Poway.

[UP IN ARMS]

“I think we were about the only brand new house in the Poway school district on 5 acres with ocean view”

I’m sorry but I could not sell that no matter what. That may been easy for you but there is no way that once I was in something like that, that I could up and leave. Not sure in Poway how far down 5 acres with view could go down to. Score great deal later more inland but damn 5 acres in Poway.

[novice1027]

PS,
I looked it up on Zillow and was wondering why would you build a 1600 sq ft home on 5 acres? Is that correct?
How did you have a laundry room with only 1600 sq ft, and it said that it was built in 1986, did you re-build or what, because I thought you said that it was a new home? Maybe I’m not looking at the right house but I pulled up the address from the assesor’s site that ncJim put in.
Just curious

[sdrealtor]

The assessor’s data is wrong on her house just like it is wrong on many others including my own. Thats one of the major shortcomings fo a site like Zillow which is only as good as the data it starts with. As they say…Garbage In, Garbage out!

[novice1027]

Interesting. Thanks for the info, because I couldn’t figure that out. This is all new to me.

[an]

“I think we were about the only brand new house in the Poway school district on 5 acres with ocean view”

Ocean view? How do you get ocean view on Poway? the west end of poway is at least 5-10 miles from the coast. I would assume you live on the east end since it’s borderline Lakeside. I don’t know about you but 5-10 miles and you need a binocular to see the ocean.

[lostkitty]

“Thanks for sharing that and participating in this forum. I invite you to consider my point of view…”

Must be similar to Tierrasanta. I would never have believed they could have beautiful ocean views out so far east… until I visited a friend’s house. Stunning view. No white caps, but it really had the same feeling as a closer up view from Del Mar. Surprised me.

BTW, does anyone know what is happening in the Tierrasanta market? That is an area that was grwoing fast just before we moved.

[powayseller]

Jim had no business listing my personal information.

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