This sold for $3,100,000, which is a good value for those who appreciate this location and view – congrats Amy!
Speaking of the Oracle, how did you like his price reduction?
He was listed at $11,000,000 for 19 months with no adjustment, and then drops the price by 28% to $7.9 million?
Is it a good strategy to drop that much, all at once?
It would be, if you were convinced that it would work. What must have happened for the 3rd richest guy in the world to dump like that?
- Listing was very stale.
- They haven’t had any action. Few, if any, showings, and no offers.
- Agent was confident and recommended ‘hanging in there’.
- Seller recognized that something drastic was needed.
Warren probably suggested the dump – listing agents wouldn’t go that far.
But what will buyers think? Will they jump on it now?
There was a local property that dropped 14% this week, and my interested buyer said, “I can’t wait to see what they do next month!”
There is shock-and-awe effect with a big price reduction, but there’s no guarantee it will work. If it doesn’t, then in Warren’s case he just blew $3,100,000 – and you’re begging buyers to take the chance that it doesn’t sell.
I’ve recommended price reductions of 5%, which would still get attention. If Warren did that every week, it would hold the buyers’ attention better too. They would be reminded – and encouraged to step up – every few days.
Are you going to remember his reduction a week from now? If you do, and it still hasn’t sold, it will be a reminder that it didn’t work!
He’ll need to lower it again!
Here’s a homebuyer story that also gives a little-known but important tip on how self-employed people can qualify for a mortgage (Freddie Mac only requires a single tax return to qualify). It combines a Zillow-like personal story with some education too – NAR should do more like these!
Ed King started with the Strawberry Alarm Clock, but was best known as one of the three lead guitarists for Lynyrd Skynyrd (along with Allen Collins and Gary Rossington) – though he left after fights with Ronnie, claiming he was just a California hippie. Here is a song that Ed wrote, and plays lead guitar:
In 1970 the Strawberry Alarm Clock appeared in the Russ Meyer cult classic film Beyond the Valley of the Dolls. By this time the band’s audience had mostly disappeared. They kept performing for some time, touring the South in 1970 and 1971 with Florida band Lynyrd Skynyrd opening for them. In the latter part of 1971, the group, now without a record label and in conflict over musical direction, opted to disband, with King deciding to relocate to the South and Gunnels joining the backup band for the Everly Brothers, alongside Waddy Wachtel and Warren Zevon. King was invited to join Lynyrd Skynyrd in November 1972 and accepted, becoming a member of that band from 1972 to 1975, then again from 1987 to 1996.
Hat tip to Kerry for sending in the latest on the Oracle’s house in Emerald Bay. The listing has run a typical path – while ignoring the current condition of the home, and able to make gobs of profit at half the price (the original $11M list price was 7233% above purchase price), they list for the highest imaginable price during last year’s selling season – and let it sit, in spite of the results. Now that the market has passed, they lower the price – but is it too late, and just cause buyers to keep waiting to see if they are right that it’s really a teardown on an awkward lot?
Billionaire investor Warren Buffett is slashing the price of his California beach house to $7.9 million, after putting it on the market for $11 million in February 2017, according to a spokeswoman for the listing agent.
If the property sells for its new asking price, Mr. Buffett will still make an impressive return, having paid just $150,000 for the home in the early 1970s.
The 87-year-old Berkshire Hathaway chairman, the third richest man in the world according to Forbes magazine, spent holidays at the beach house. He said in an interview last year that he bought the house because his late first wife, Susan, loved it. Since she died in 2004, he hasn’t spent much time there, which prompted him to list the property.
He said the Laguna Beach area had changed dramatically since then, becoming more developed. The house was renovated several times through the years but not recently, said the spokeswoman for the listing agent. Mr. Buffett also purchased an adjacent house, which he called “the annex,” to make space for house guests, and connected the two homes with a staircase. The annex was sold in 2005.
Mr. Buffett recalled hiding out in the home’s master bedroom to write Berkshire Hathaway’s annual reports during Christmas holidays, and visiting Disneyland with his children.
The roughly 3,500-square-foot, three-level Laguna Beach home is in Emerald Bay, a high-end gated community with views of the beach. It has six bedrooms. Two of the bedrooms have their own separate entrances for guests. The house fits Mr. Buffett’s famously understated tastes, with gray carpeting and white laminate countertops.Link to Article
Another intriguing piece is the listing agent. The seller owns a major real estate brokerage, but he lists this house with an outside company and an agent who has had nine sales since 2009. But all of his sales are in Emerald Bay, and he weaves a tale of being a third generation realtor.
Telling grandma stories and pining about the past may have been alluring 18 months ago, but now what?
Will the current turbulence in the real estate market make boomers drop everything and list their home for sale in the coming months, or just scoot a little closer to the exits?
How many were already counting on every dollar of equity based on their lofty estimates of value that are now in question? Do they pack it up and wait for a few more years? Or sell now while they can?
The pressure is coming from many angles too – if it was just up to boomers having to survive on their own, they’d be fine, even if they had to cut back on the current lifestyle. It’s their parents needing the expensive assisted-living and the kids trying to get ahead that puts the additional strain on boomers, and could make them sell their house.
It’s a curious topic for those around housing – how will it all play out?
These charts and graphs are from this story in the WSJ:
•The percentage of families with any debt headed by people 55 or older has risen steadily for more than two decades, to 68% in 2016 from 54% in 1992, according to the Employee Benefit Research Institute, a nonpartisan public-policy research nonprofit.
•Americans aged 60 through 69 had about $2 trillion in debt in 2017, an 11% increase per capita from 2004, according to New York Federal Reserve data adjusted for inflation. They had $168 billion in outstanding car loans in 2017, 25% more per capita than in 2004. They had more than six times as much student-loan debt in 2017 than they did in 2004, Fed data show.
A combination of economic and demographic forces have left older Americans with bigger bills and less money to pay them.
Tempted by a prolonged era of low interest rates, boomers piled on debt to cope with rising home, health-care and college costs. Interest-rate declines hurt their security blankets. Lower earnings on bonds prompted many insurance firms to increase premiums for the universal-life and long-term-care insurance many Americans bought to help pay expenses. Some public-sector workers are living with uncertainty as cash-strapped governments consider pension cuts.
Gains in life expectancy, combined with the soaring price of education, have left people in their 50s and 60s supporting adult children and older relatives. Some are likely to have to rely on professional caregivers, who are in short supply and are more expensive than informal arrangements of the past.
Read full article here:Link to WSJ Full Article
Hat tip to Rick for sending in this incredible VR – I need to broker these!
Investors are spending real money to buy land in a new city that only exists in virtual reality. Buyers can build whatever they want on their plots in Decentraland. Many hope to make a profit trading goods and services in the virtual world’s own crypto currency. But will Decentraland be an online utopia or a cyber slum?
More on how I use the open house as a selling tool:
The National Association of Realtors (who smartly reeled back their launch of a $250,000 new-logo-that-looked-like-the-old-logo campaign), is running new ads in ‘a limited campaign targeting millennials’.
Here are samples – I’ll wait over here by the phone for those millennial calls: