If you ever watch poker on television, or play poker yourself, the speech generally comes when someone thinks they’re in a strong position but really isn’t all that certain. Lacking that certainty, a monologue begins all with the specific purpose of uncovering information.
I just received The Speech from a listing agent in Westbrook Village regarding a property on which I wrote an offer. To this agent, the only comp that matters is the casita he sold next door – a casita selling for the highest price per square foot in Westbrook’s older phase in at least six months.
When that property closes, this agent will have sold exactly one property ever in Westbrook Village, a 5,000-odd home active adult community in Peoria.
One property or, more specifically, one fewer than I put under contract myself in Westbrook this week. Or about a dozen less than I’ve sold there over the past couple of years.
Unlike the rest of the Valley, where demand has soared while inventory has been non-existent, the active adult communities have been running largely out of sync. It took an extra year before values really started to fall and there’s been virtually no sign of prices stabilizing.
Around the corner from this same casita was a bank-owned property listed at $140,000. One of my buyers had it under contract at $125k before changing her mind; it eventually sold for $120,000. In nearly every subassociation in Westbrook, values have been falling to levels not seen in years.
“We have to coach our buyers that there is a changing dynamic in this market,” said this agent. “They can’t just walk in with the expectation of purchasing a home below market value.”
Of course, market value is in the eye of the beholder. The question is, who has a better handle on the property’s true market value – the agent looking at one comp or the agent looking at several.
Did I mention neither of my two buyers this week in Westbrook Village are paying full price for their properties?
“Given the activity we’ve had at our open houses, we’re confident we’ll get a stronger offer.”
I hope so, for the sake of my owners in the area. But I have to say, I tend to wonder about an agent who confuses open house foot traffic with real interest. Any experienced agent knows someone saying “I’ll write an offer in 10 minutes” is about as solid a prospect as someone who never comes through the open house, not until the contract is in hand.
There’s a time and place for The Speech, no question. But it doesn’t work when there’s nothing more behind the speech than a bluff and a prayer.
I’ve got the buyer. I know the market. I’ve got the nuts, son. Good luck with your two-outer.