A buyer client of mine is in escrow to purchase a uniquely beautiful oceanfront half acre with a run-down house that he plans to transform. It is, without doubt, the prettiest piece of land I've ever sold. But he's getting a lot of kickback from well-meaning family and friends, particularly because the list price was, essentially, non-negotiable.
A lot of buyers believe that one should never pay full list price. They feel like they've scored if they can get the property for, say, 5 or 10% off list.
If the property were priced at market value, a 5 or 10% discount would be a score. And there are occasionally sellers sufficiently motivated to sell for a below-market price.
There are also sellers who price their property 10 or 20 or 30% ABOVE market value. These are the misguided sellers who believe "we can always bring the price down if it doesn't sell." Okay, that may be true, but the longer you sit on the market over-priced, the staler your listing gets, the more people wonder what the heck's wrong with your property, the lower your ultimate sale price. Inevitably, your final sale price in this scenario will be lower than you'd have gotten if you listed at market to start with. (I know sellers find that hard to believe, so I bring tons of examples to show them.)
When buyers insist on offering 10-20% under list hoping to end up 5-10% under market, I ask these questions:
1. What if the list price is 30% over market and you get it for 10% off list? Have you scored?
2. What if list price is intentionally priced below market to get a quick sale...and maybe multiple offers?
When the property is exceptional and well-priced and seller is inflexible on price, the only question to ask is, "Do you want this property?"
It's like when a long-anticipated new car hits the market (Toyota's Hybrid Highlander comes to mind) ... you want it, you pay the price. Unlike cars, real estate is not going to be cheaper later. A truly unique property is not likely to be available again any time soon.
