About 6 months ago I had to move I bid at 2 places and seriously considered another. First 2 were relatively new buildings with spotty sales histories (hence my though of deal potential). First place I was outbid about a week after reaching a deal (I did not counter) and the place sold recently for about 10% above where my deal was (not sponsor sale). The second place I walked away from (seller... [more]
About 6 months ago I had to move I bid at 2 places and seriously considered another. First 2 were relatively new buildings with spotty sales histories (hence my though of deal potential). First place I was outbid about a week after reaching a deal (I did not counter) and the place sold recently for about 10% above where my deal was (not sponsor sale). The second place I walked away from (seller didn’t go low enough) and that place went into contract a few months later and recently sold for 16% higher than where I was offered the place (sponsor sale). The third place is a bit different as it was an older building and I never bid on it but thought there was no way I’d pay anywhere close to ask, and in fact I was going to ask for a 10% discount. That place recently sold at 20% lower than initial asked.
So, I could have very easily ‘underpaid’ 10-15% in the first 2 cases and ‘overpaid’ 12% for the third place. In addition, the 2nd place sponsor was asking me to pay higher with refunds to come back to me after closing (hence higher print for future sales).
What this tells me comps are useless and that there is always a bigger fool out there. Now, is the next fool going to come and see these first 2 prints and estimate ‘fair value’ off those and pay a bit more for another place? And for how long will there be bigger fools coming out of the woodwork? I fully understand that I could have been that fool on the 3rd place had I gotten a 10% discount that I wanted.
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