My friend Geno reminded me today that some are in the “leave the gun; take the cannoli” stage of the real estate market. It also reminded me of the stark differences between 2008 and the last time I participated in this same kind of market, which was in 1990 and 1991.
I remember leaving the gun and taking the cannoli in Yardley, PA. when I was working for one of my two favorite brokers, Frank Mancuso, also one of my two favorite Franks. I was working with a nice young family, relocating to Yardley from somewhere else, trying to find a good value in a turning market like this one. We “targeted” a house where the owner had been relocated by his company too. We truly held a gun to the head of the “relocation company” during initial negotiations, and then picked the carcass clean at time of inspection in a second round of negotiations.
The similarities? Only those who really wanted to sell, or HAD TO sell, were selling. The deepest discounts being the vacant houses where the owner had already moved on, and there was no chance the owner would be coming back.
The differences? The reasons why people “had to” sell. Tim’s story yesterday reminded me of when Buddy Ryan was canned by the Eagles in 1991 and everyone in the office was wondering who would be selling his house. Needing to sell your house in a bad market, especially when the vultures perceive that you NEED to sell it, can be an awful place to be. Still when the sellers are highly paid people or relocation companies, no one’s wasting any tears. It’s when the carcass to be picked looks like the family depicted below, that you take pause.
Truth is, people trust professionals to NOT let them, or encourage them to do, what will hurt them. So when you take out the gun and put it to someone’s head so that you can leave with the cannoli…at least look them in the eye when you’re doing it. Maybe talking someone into doing a short sale is like pulling the plug on someone that was just about to be saved. Think about that before telling people a short sale is their only or best choice.
The only difference between buying a short sale and buying a foreclosure is whose head is at the end of the gun, and whose cannoli will taste better in your mouth after all’s said and done.