For this townhome I just sold in Los Gatos for $1,350,000, I was the agent for the sellers. This is our FOURTH transaction together over the years and I actually sold this townhome to them as buyers over 10 years ago.
Talk about timing…when we initiated the discussion of selling this townhome, they had tenants living there. And, at that time, it was a bit before COVID started to become a hot topic. But, at that time, townhomes were selling for high prices in the community and still moving.
As weeks went on, shut downs were starting to happen and news was getting more intense. The renters found a place to move, and at that point, weren’t interested in staying, since the idea was to sell this home. Although, as COVID was the news, we thought it may be good if the tenants would just stay and put this idea on halt.
Well, the tenants moved out because they had already found another home, and since the place would be vacant, went ahead with the plans to sell. However, by that time, this community had practically come to a complete halt, and nothing was selling at all. There was another listing that was the exact same model and even same street, just doors away that was just sitting on the market with no activity at all.
At this point, the complete shut downs were happening, that mid March timing, when contractors could not even go do work, and when even us realtors could not show homes. Once the tenants were out, we actually had to wait for some time until the contractors were able to work again. So, we just kind of waiting around a bit.
And, all the while, the other listing was sitting there, as well as a few others. Once we were ready to list the home, there were quite a few others on the market as well in the same community, and really the only way to differentiate ourselves was price, to list at an aggressive price under the other listings, to spark something.
And, it worked! We had an interested buyer within days of listing the home who was very interested in buying, but needed to do a 1031 exchange. And, to our misfortune, at that time, the rentals in the community were tapped out. My clients could still rent out their home, but if they were to sell, the buyer would need to live their as their primary residence, because there was a waiting list to rent. What a major buzzkill to say the least! Trust me, we tried to see if there was any way this buyer could still buy, but nope, wasn’t going to happen.
We then really had no other serious interest at that point, and more inventory came on the market as competition, plus, other homes stole our idea and lowered their pricing too, in order to compete with us. The other downside that seemed to be an issue in this COVID environment when it was all new and scary, were that buyers seemed to be backing off due to the high HOA dues of $760/month. It didn’t seem to be much of an issue before COVID and when the market was super hot, but buyers seemed to be more conservative and really looking into all factors and seemed more cautious about this community due to the high HOA dues.
At this point, there are a LOT of homes in the community for sale, basically, none of which were selling, unless there was some unique feature to it, like on the view side, or something that just really stood out as a big difference. Otherwise, there were PLENTY to choose from, all of which competing with eachother. So, we made one last effort to lower the price to differentiate ourseives yet again, and hit yet another price point that additional buyers would fit into, and that worked!
We received an offer shortly after that price reduction. A buyer that waived ALL contingencies (loan, appraisal, and inspections) and we grabbed it! Once we went pending, a few of the other homes also reduced their pricing similar to ours, so thank God we did it first, to grab the next buyer looking in the lower price range, before we had more competition yet again, with homes similar in price.
The transaction itself was decent, a little bumpy only because the buyers didn’t seem to understand they bought in ‘as is’ condition and kept going back to the property, time and time again, to find one thing after another, to ask the seller to fix, want a credit, etc, etc. I was personally kind of baffled as to why they didn’t see all they needed to see before they made the offer, and they also had all the inspection reports as well. The various trips back to the property to report additional items every time they went, was a little troubling, but we got through it. They wrote an offer with NO inspection contingency and in ‘as is’ condition, so I don’t really get why they kept going back and asking the sellers to address anything. And, to top it off, the requested items were just so small and picky. I didn’t get it, but…we got it done! Meanwhile, to this day, there are still quite a few of the other townhomes sitting on the market in this community, so I am VERY thankful we got this home sold!
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