“The market is going up, haven’t you noticed?”
Real Estate summer stories
July is about to expire soon and August is not expected to be a very "active" month for deals and transactions (ah… where are the good years of 2004 – 2007, when we had our best periods during summers…) More or less, we have read "the script" of this summer's market. Things have remained unchanged. Prices are not the only ones having a downwards trend. The same happens with people's mood, income and expectations for the future.
Let me share with you some of my experiences so far, during this summer… the summer of 2010.
1. More serious people, or just my impression?
Probably it is just my impression, but in case it is not, I consider this issue the most important of this summer. I don't know why, but lately I see more serious people in the market. They are working in smaller or bigger companies, being clients, owners, Real Estate brokers, lawyers, architects or having another occupation. They are not talking nonsense, but straight to the point, without having in mind how to trick you. I hope that the time when they will be majority in this society is coming fast…
2. Many people have quitted hoping
On the other hand, I also notice many people who have changed domain of activity, from Real Estate to anything else. Unfortunately I see others who have quitted hoping that things can improve, no matter which is the market segment of their profession.
3. "The market is going up, haven't you noticed?"
My company doesn't deal with sales of small apartments (except foreclosures), so I proposed to a friend of mine to search a property by himself. The lovely Real Estate agent presented to him a property in Titan and informed him about the price. When my friend told him that he finds the price very high, the gentleman had a solid reply, structured with strong arguments:
- "These are the properties in the market".
- "There are no better properties available".
- "The supply is limited".
- "The demand is growing".
- "The market is going up, haven't you noticed?"
- "So, let your worries aside and buy NOW, before the owner changes his mind and you lose the opportunity".
My friend, typical "person in a hurry", furious to buy NOW as "it is impossible for me to wait", asked my opinion. "What should I do, this is what they offer to me". "Simple, you should…" "… buy the cheapest one I will find?" "no, you should just refuse to give your money to bullshit". "And what if the guy is right and the market started growing?" "Next time ask him: "As the market is growing and you have so many clients, how much do you earn per month? How many transactions did you have during the last 3 months?"
He asked indeed. You can guess the answer: "One transaction, a small garsoniera, the owner was in a hurry to sell". Yeah, clear sign that the market is growing again…
4. Some agents insist trying to negotiate on behalf of their clients…
Sometimes an agent is requested to negotiate on his client's behalf. But many other times he is just asked to bring the client in direct contact with the owner, in order for the two of them to sit on the same table and discuss about the price face to face. It looks like that bad old habits are still here. During the summer I heard 6 different people complaining that the Real Estate agents were trying to negotiate with them without informing the owner, usually rejecting their price offer in advance.
My suggestion: Don't lose your time with people who don't respect your money, there are plenty of good professionals out there. Try them (and don't forget to pay them for their services, once they succeed to give you what you want).
5. An announced deal is not always a real deal
One of the biggest Real Estate deals which was announced during this summer is not a real one! Despite the announcements, the buyer probably steps back, as "his people" don't agree with the investment.
"And then why was it announced then?" you may ask. Easy:
- Journalists squeeze any possibility for news
- The people involved wanted some positive publicity
- Probably there was an initial agreement and they hurried up
6. "Summer homes" sales collapsed
My company is not directly involved in "summer homes" sales. We chose not to be part of this market (as well). But I keep an eye on this domain as well, asking around (and not only). It looks like very few people "dared" to invest in a second home, anywhere at the Romanian coast. Same situation like the residential market…
More Real Estate summer stories in the end of August