In the third week of September 2008 I sat at a table with a builder on one side and the buyer’s father on the other. “You should accept this offer,” said the father, doing his best impression of a tenured college professor. He began lecturing the builder sitting directly across from him. “You are young, and this is your first downturn. You will lose your shirt on this new construction but in a few years from now when you look back and internalize that I saved the day, you will thank me.”
Now, if you’re wondering what led my buyer’s father to speak in such brazen terms to the builder I was representing, rest assured these were not normal times. Lehman Brothers, the fourth largest investment bank in the U.S. had collapsed only a few days earlier and the fallout was swift. I had been working with this builder for months trying to secure a deal on this very same new construction for a family in Canada. The entire house was customized to this buyer’s specifications, a deposit was secured and then suddenly the financial markets crumbled. The Canadians panicked and immediately backed out of the deal walking away from their deposit.
At that time, I was determined to keep the builder optimistic and tried to assure him (and myself) that while he might not match his original deal with the Canadians, given the new reality there were still opportunities available. I surely could not have anticipated either the father’s tone at this meeting nor could I have possibly foreseen that the offer would be as low as $750,000 for a $1.1 million dollar new construction.
The builder kept a cool demeanor the whole time and sat quietly during the tirade. “Thank you very much for your offer, my agent will be in touch with you,” and with those words the builder stood up and the meeting was over. The buyer left and we sat in silence for a few moments looking at each other. “This guy thinks he’s buying shares of stock after a crash; that’s not how real estate sells in this area.”
A few tense weeks later, using some creativity we made a deal with a third buyer. Instead of knocking the whole house down, the decision was made to keep the foundation as well as much of the original house and create a large renovation plus expansion. The price point was adjusted thus procuring a buyer at that precarious moment in time.
I learned a lot from this encounter. Number one, keep your mouth shut and remain calm when there is an argument going on, especially when you represent both parties.
Number two the old adage that the customer is always right is simply not true.
Nechama Polak is the Broker of Record and owner of V and N Group LLC located at 1401 Palisade Ave in Teaneck. [email protected] 201 826 8809.