Archive for the ‘War Stories: Winning Tactics for Buying/Selling a Home’ Category
June 29, 2007
Recent MBA grad, Mark Trang, spent weeks searching for a place in San Francisco to call home and found that the housing, like most things in the city, was terribly old or 21st century new. After an unsuccessful bid on an older property he decided to make an offer on one of the gleaming new condominiums in the SOMA district.
To his surprise, Redfin agent, Max Diez negotiated a winning deal that included two years of free HOA dues and walked away with a $12,660 Redfin commission refund. Not bad at all.
If you’re already researching using the Internet and attending open houses on your own time, why pay a traditional buying agent 2-3% when all you need is support during the actual transaction? Redfin delivered exactly the value I needed but at a cost that makes sense. My Redfin agent, Max Diez, and the rest of the Redfin team was very responsive and provided great insight during the offer and escrow process, particularly when it came to the local nuances of buying property in San Francisco. I am a big fan of the way Redfin is transforming the real estate industry and look forward to using them again when I buy and sell property!
-Mark Trang
The floor hasn’t completely fallen on San Francisco real estate but there are deals to be had if you’re looking to take advantage of a boom in new construction building and plenty of cautious buyers sitting on the sidelines. If you have a funny or insightful story for us about how you bought or sold a house, send it to bahn (at) redfin (dot) com; we’ll probably use it, and then we’ll send you a gift certificate for a dinner anywhere you like.
June 6, 2007
At lunch with Cynthia and a local real estate baron, we heard about a new tactic for getting a deal on a property. Rather than offering a lower price, ask the seller to handle closing costs, which can run up to $10,000 or more.
Builders with multiple units prefer this approach because they avoid recording a sale at a discount, and listing agents like it better, too. If you have a funny or insightful story for us about how you bought your house, send it to bahn (at) redfin (dot) com; we’ll probably use it, and then we’ll send you a gift certificate for a dinner anywhere you like.
June 13, 2006
We received another fantastic entry for our War Stories feature this week. This one is from Redfin commited user and longtime booster Peter C. He and his wife were making a big move to the East Coast in 1999 and came up with a creative trade that sealed the deal. Here it is, in his own words:
In 1998, I traveled to the Boston-area from California to find housing for my wife and I during grad school. On the school’s intranet I found a post by a graduating student who wanted to sell her condo/townhome a few blocks away from campus.
I stopped by the house unannounced,introduced myself and discovered over normal chit chat that the seller was coincidentially moving to our neighborhood in California after graduation, but didn’t yet have housing in the uber-competitive bay area housing market.
I asked about buying the Boston condo (it was perfect for us) hoping for an inside-deal, but the seller wisely said that the Boston market was as frothy as California and that she was planning on simply taking the highest price (and she had already engaged an agent) based on offers received the next day. She had had indications that at least 6 offers were forthcoming.
My wife (who was back in California and hadn’t seen the place) and I quickly determined we wanted the condo, but couldn’t afford a bidding war. Therefore, we made an offer and we included a clause that obligated the buyer (us) to provide the seller 4 months free housing at the buyer’s home in California.
The risk we took is that the seller could’ve been an axe-murderer (we didn’t know her at all other than my “drop-by” meeting the day before) or merely obnoxious as a four-month roommate. We also risked paying a few extra months of our California mortgage before selling, but that was far less than what we would’ve needed to increase our bid to win the deal solely on price.
The seller did in fact get 7 offers, most higher than ours, but we won the bid anyway because the seller was worried about her California housing situation and we solved that for her. And a month later we had a random stranger as a roommate for the entire summer.
Thanks Peter for the excellent story and a great lesson for all of us about how important it can be to make sure you take account of all the factors when you make an offer. Sometimes, there are elements even more important than money when you really want to the seal the deal. For his effort, Peter gets dinner at the restaurant of his choice. Do you want us to buy you dinner? Just share your great offer story with us and, if we post it, we’ll give you $50 towards dinner at your favorite place. Just email it to eric.heller (at) redfin.com.
May 19, 2006
We continue to get great responses from our call for real estate war stories. The following, from Betsy, of West Seattle certainly ranks as the strangest one that we’ve received. While it might be strange, its certainly interesting, and Betsy makes an excellent point about how a good connection with the seller can sometimes be even more important than the final offer price. Take it away Betsy!
It took us two years to find our dream house: enough bedrooms for our family and home office, plus enough yard for my vegetables and my husband Jerry’s dream orchid greenhouse. The house was only on the
market for four days. We visited every day, managing to corner the owner each time and barrage him with questions about the property.
Betsy’s House:
I wrote a lovely letter outlining our hopes for the house and including a picture of our children. When we made a bid, there were eight competing offers. Our agent came back to us and said, “They have two questions for you. One, would you be willing to give them the washer & dryer? And they want you to know that their daughter’s placenta is buried under the apple tree. You just need to know that.”
Jerry and I looked at each other and burst out laughing. We both told our agent: “Our son’s placenta is buried under our fig tree!” Bill grinned and sprinted back to the meeting room. Two seconds later shouts of laughter erupted from the meeting room and he came racing back. “Sign here, sign here, here’s the price, you’ve got the house.”
The sellers sold us the house at $65,000 more than the asking price — but our escalator went up to $87,000 more than the asking price. We could hear the other agent shrieking, “My client will pay more! My
client will pay more!!” (Our strategy was — we had an escalator clause of a very weird number, something like $1,118, and we had a very high (for us) ceiling). The other person was willing to top $487,000, but the seller chose us because of the placenta.
This was a case of absolute karma — the sellers were the kind of people we would have liked to have hung out with. They wanted US to have the house, not because we could pay top dollar, but because we clearly respected the craftsmanship of the house and wanted to treat it with love for the next 30 years.
We’ve been in the house for almost a year and every time I drive up our road, I pray to myself, “Please let our house still be there, please let it still be there.” We love it that much.
Thanks Betsy, for your story and example of how even the obscure can make the difference when it comes to winning the bid on the perfect house. As a thank you, Betsy gets dinner at her favorite restaurant on us. Got a great war story? Send it on to eric (dot) heller (at) redfin (dot) com — we’ll post it up and send you out for dinner as well!
May 11, 2006
We’ve received some great responses from the call we put out last month for real estate offer war stories. One of the first to come in was from Sue M. She originally moved to Seattle as part of a corporate relocation package and, during one of her house hunting visits, found a house that she just had to have at any cost (literally!) Read on and discover the power of persistence and a blank check. 
Here Sue’s story, in her own words:
I was at an open house and my realtor could tell that I REALLY wanted the house. So she got the conversation going with the owners. We found out that the current owner and I had run the Chicago Marathon the same year and that she was due to have a baby girl in just two months.
We were to present our offer the next evening as one of 10 offers (!). I told my realtor that I’d rather pay too much for the house than lose it. We debated how far over list price we needed to go to win the bidding war. We decided on a strategy to just go in with a blank check and I went to the store to buy little pink running shoes for the soon-to-be-born baby girl as a sweetener to the deal.
We gave them a signed contract with the amount line left blank and told the sellers to fill in whatever amount it would take to get the house. I was a bit nervous, but my realtor’s lawyer assured us that they couldn’t put in a ridiculous amount without my consent. So we waited at a nearby restaurant for them to review the other offers and let us know the outcome. Oh, and my realtor presented the little pink running shoes to the delight of the soon-to-be-parents.
Here’s a picture of the house:
We got a call at the end of the presentations asking what our offer would be. We offered well above the highest offer, but also well below what I was willing to pay. Thinking we had it wrapped up, we paid the check and walked down to the real estate office. We waited some tense moments in the parking lot, eyeing suspiciously any cars that looked like they might be pulling into the parking lot to steal away “my” house. We got another call saying that the other buyer matched my offer and could I do anything to make the decision easier for them. We threw in another $5k and went back to waiting for the final call.
We got the call that I’d won the bidding war. The strategy of the seller setting the price low to prompt a bidding war seemed to work in my favor–the buyers who could go as high as I could didn’t bother to check out the house because at the list price, in my neighborhood, one would assume the house must be a fixer. And the folks who did look at it evidently couldn’t (or wouldn’t) pay what I did. I’ve been in the house for 3 years and cheer every time I see data that indicates the house has appreciated significantly. I feel very lucky…
Thanks Sue, for your excellent story and lesson on persistence when it comes to finding hidden jewels in this crazy housing market. As a thank you, Sue gets dinner for two at the Dahlia Lounge on us. Got a great war story? Send it on to eric (dot) heller (at) redfin (dot) com — we’ll post it up and send you out for dinner to your favorite restaurant!
April 17, 2006
The clever, under-stated Clay Nielsen was the first to answer Redfin’s call for “war stories,” tales of intrigue and derring-do to give Redfin shoppers an angle on winning deals. This one is *good*.
Here’s Clay story, in his own words:
In May of 2005, my wife and I decided it was time to start looking for a larger house for our growing family. We knew the neighborhood that we wanted to be in, but were having a hard time finding something that was just right. We finally stumbled upon an old “tear down” on a very large lot that would enable us to build a new house that truly fit our needs. We knew that this opportunity would generate competition so, to win our Madison Park house, we submitted an unusual offer at the offer deadline with these terms:
* Our offer would beat any other offer by $5,000 with no cap.
* Ten minutes after the offer deadline, the listing agent had to call us and inform us of the highest offer with escalator received.
* We in turn had to respond within 5 minutes that we would in fact pay $5,000 more their highest offer.
* We cautiously agreed to pay higher offer, which was $175,000 over the original asking price.
* The listing agent then asked us to fax her our offer. We said “no”, that she needed to send us the offer signed by her client so that we did not trigger any further escalators.
* She reluctantly agreed and the house was ours.
The other interested parties were scrambling to figure out how they could reposition their offers to get this prime piece of real estate, but the deal was done.
If you really want to win without committing to a price until you see the price, and without getting into a bidding war or even really a negotiation, you might to try a no-haggle option like this.
For sharing such a great tactic, Clay gets dinner for two at El Gaucho (his choice). Got a great war story? Send it on to glenn (dot) kelman (at) redfin (dot) com — we’ll post it up and send you out for dinner to your favorite restaurant!
