patrick.net

Not every FSBO is overpriced. Keep looking for the right place.

elliemae says

Not every FSBO is overpriced. Keep looking for the right place.

That I can agree on. But I don't think he could have gotten that price in 2006.

FSBO brings up an issue to me. Owners want to sell privately so they can get more money. Buyers want to buy FSBO to save money. But the owners are wary of giving any savings to the buyers it seems like. This isn't the first FSBO I was pursuing. But his price made me choke.

Some of them go for FSBO to save 6% realtor's commission. When such seller has attitude too, the chance of him giving you a discount is near zero.

Just skip that house. It looks like a POS to me, and there's no way for you to pay 700K when his neighbors are selling home at 4~500K.

I can sympathize--I found the same thing when I was last house hunting. I gave up on FSBOs because the sellers were always delusional.

Some FSBO's are FSBO's because a Realtor would not take the overpriced listing. As was stated by Seaside, some sellers simply want the commission in their own pockets.

I second 'ordertaker'.
I'm sure we've all stood, knee deep in garage contents strewn in a front yard trying to negotiate with a complete loon, over some forgotten artifact he/she hasn't used in 10 years, but thinks it's worth a small fortune. Why would things be different about a house?

Also judging by the price he paid for it... he hasn't been involved in the 'industry' since the 70's, and you KNOW some family member plucked this price out their ass. "I'm telling you Lloyd, it's worth at least $800K."

My favorite is...he's has nothing to do with the industry, but likes to use the X99K perception trick. A true FSBO would just call it 800K and be done with it.

junkmail says

My favorite is…he’s has nothing to do with the industry, but likes to use the X99K perception trick. A true FSBO would just call it 800K and be done with it.

Since he's using that trick, he must think that the appearance of $700k looks appealing :) I am positive even if a realtor listed this at $599k, nobody would view the home.

I really think that it was FSBO since 2006.

Saving 6% on an $800k house (that's actually worth $800k) is a lot in raw dollar terms. If the two sides just split the money, that's $24k each even though it's 'just' a 3% discount for each. Granted, a good $5k or so will go to services the realtor probably provided, but that's still close to $20k of savings. Is that extra effort worth $20k?

The lower the price, the less of a reason to avoid a realtor, since 6% of $100k is a lot less than 6% of $400k or $800k. But it's a similar amount of work it seems.

Anyways, yeah, you'll probably run into a lot of idiot FSBOs, especially in a bubble area where people don't want to face reality. The funny thing is you'd think some guy that bought 30+ years ago would be able to be more realistic since he wouldn't be selling at a loss even at market price.

http://www.redfin.com/CA/Daly-City/463-Northaven-Dr-94015/home/1412519

neighbor at 463 northaven, few houses down, is selling for $275k

ordertaker says

Some FSBO’s are FSBO’s because a Realtor would not take the overpriced listing. As was stated by Seaside, some sellers simply want the commission in their own pockets.

I've never known a realtor to turn down a listing. They list, then get the seller to reduce.

mike says

http://www.redfin.com/CA/Daly-City/463-Northaven-Dr-94015/home/1412519
neighbor at 463 northaven, few houses down, is selling for $275k

Yeah I saw that one. It's actually an auction. You go there on the set date, and you bid with everyone else. Starting price is $275k, with $5k increments. I'm interested to see what will happen. There won't be anyone blindly overbidding by 100k against themselves.

elliemae says

ordertaker says

Some FSBO’s are FSBO’s because a Realtor would not take the overpriced listing. As was stated by Seaside, some sellers simply want the commission in their own pockets.

I’ve never known a realtor to turn down a listing. They list, then get the seller to reduce.

But you'd have to look at it in a realtor's shoes. If he was over priced, but not by far, the realtor can nudge him to lower his price twice by say, $20k each time. At $799k, it will take several years to make him lower to the realistic price of $500k with decrements of $20k each time.

Even if one were to drop $300k down payment for this property, the transaction will fall through after the bank appraises it.

Don't be discouraged by this particular experience. If someone is not reasonable and not willing to negotiate just move on and keep looking.

The only FSBO I've ever known did it because he absolutely hated realtors. He tried to sell two houses by FSBO... the first one he sold by himself despite being blackballed and belittled by local realtors. After it sold, he put "SOLD... BY OWNER!" on the sign.

The second time he tried to sell a house by himself, the local realtors were too much of a cartel to fight against. On an open house day, one of them parked reverse-ways in front of his house from ten minutes before the open house until immediately after. He was carrying two mortgages at the time and just couldn't fight them any longer and eventually went with a realtor.. out of town... which has it's own pitfalls... but the place sold relatively quickly.

The Realtor is a jerk? No way..... LOL.

I'd say you got a good deal by not buying. What's with the roof? Kind of an ugly looking house.

He should have no problem getting 799K for it.

In 2050.

I agree with CrazyMan...too funny. 799k! This is not Fantasy Island.

Household combined income of $265,000 per year + $160,000 down? For that? BLECH.

E-man says

I disagree. I say $799k by 2025 :o)

Maybe he was asking for 799,000 Pesos.

Update: This guy has just enlisted his home for sale with a realtor. I see a realtor sign on the front lawn now. There's going to be major disappointment.

Seems a lot like the people we've run in to down in Norco (Horsetown USA) and Temecula. They regularly tell us "I know what it's worth!" and "property taxes are cheaper here than there, so I can justify asking more $$$", and then the typical "this house was worth $850K in 2006!!!".

I'm still at a loss as to who is buying these properties at these still-ridiculous prices in California, essentially propping up the market. Horse property homes, the types we're looking for, are still $550K +, but 95% of them are sold "as-is" from investors that somehow managed to buy these homes from the banks for dirt cheap (cash) without the home ever having seen the market - then the guys come back out and ask outrageous prices, claiming there are "tons of buyers out there".

One house we looked at in Temecula was 2.5 acres, an interior that, although was clean, dated back to the late 70s in style, and had nothing spectacular. Called the agent, he said his group of investors would take no less than $599K and would wait, as there were a ton of buyers out there ready for a "deal like this". This was in March 2010. It's almost July 2010, and the house still sits, unsold, weeded out, and still at the $599K asking price.