Why did I feel that I was fighting two battles? One with the prospective buyer for my condo and one with my own agent.
I’d like to establish that I’m a big fan of real estate. With the tax benefits involved and the passive income derived, equity buildup and the possible appreciation — tough to beat as an investment.
And I’m an advocate of owning your own home. Not only for the investment value but for the good feeling it gives you and your wife. Your own nest.
Second greatest feeling in the world!
Another little disclosure I feel obligated to make: I’ve been in the real estate business for over forty years. It’s been good to me.
So — I tell this little cautionary tale with mixed emotions:
It was time to consolidate. I’d been retired for a couple of years. I owned two condos. One I used primarily when I was in New York on business and one I live in close to friends and family in the Philadelphia suburbs.
I concluded that I could only live in one place at a time and I rarely went to New York. Now retired, I decided to sell the New York condo.
It was a small crash pad. A studio with a tiny separate kitchen.
I checked for similar sales in the building over the past year and most of them were in the $590-$600 thou range.
I called up the one real estate connection I had left in New York, a guy I actually mentored in the business, John Abraham.
Taught him damn near everything I knew.
We talked for a while, verbally slapped each other on the back reminiscing about old business conquests. John’s much more recent than mine.
I signed a listing agreement with him. His agency gave me a break on commission, only charging 5%.
That’s what friends in “da business” do!
We agreed on the asking price of $599,000, his suggestion with my consent.
I soon was mentally calculating my profits on a $599,000 sales price.
Less than a week went by before I got a call from John.
“Brian, you have the absolute good fortune to have sold your condo in under one week.” John’s cheery voice informed me over the phone .
Man, I thought, my young real estate protege did me proud, selling my place in a little less than a week.
“We got an offer of $500,000!” he exclaimed excitedly like he’d just matched 5+ the red power ball in the New York lottery.
Huh! I thought you thought I could get $599,000 — I thought!
“You ought to take it,” John advised with solemnity.
But it’s worth $599,000, if comparable sales mean anything, my rational mind speaking.
“I’ll mull it over,” I said.
All that week while I was considering the offer , John hounded me to accept the $500,000 offer. He gave me 100 creative reasons why I should drop my expectations $99,000.
After a week of suffering, I came to the conclusion that I had 2 people working in their own interests and against me in this transaction.
The buyer, that’s to be expected.
And my own agent!
Wake up Homer:
Although John is ethically supposed to be representing my best interests, human nature is what it is:
You the seller may be taking a haircut of $99,000 on your condo, your agent, that quisling John, is only sacrificing $4950 in reduced commission for his agency.
Your agent would still be raking in $25,000 to split with his firm. Good scratch for less than a week’s work.
$12,500
Time is money in almost all business.
I resented the feeling of lost support that my former associate should have provided.
He went from advocate to adversary.
Almost as if he were representing the buyer instead of me.
Was I equally self-interested when I was an agent?
Hummm!
Let me think about that.
This post was self- published 6/10/22
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