There is a real estate axiom I was reminded of recently by Bill Lublin that goes like this: every piece of privately owned property in the country is for sale. It might not be listed, but it's for sale. If you knock on the owner's door and offer them market value plus enough of a premium, you get the keys. It could be a dollar, it could be $4 million. But if you offer someone enough money, they'll sell.
There is a corollary to this, which is, of course, that everyone is a buyer if they can get a good enough deal. I am not currently looking for a beachfront property or a condo in Manhattan, but if you deed one over to me for my pool table and $500, I'll sign today.
There are two kinds of buyers in any market. Those that are looking, and those that aren't. Those buyers who are looking are probably willing to pay market value. Those that aren't looking, well... do I have to tell you?
If you have an acquaintance who expresses interest in your home over golf or cocktails, you should ask yourself first why they are just finding out about it at golf or happy hour. Strange, no? Because someone who is looking would know you are for sale if they have a pulse (especially if you are listed with me). What does this tell us? Your friend will buy your place. And he'll clean your clock. Because the only reason he'll close is if he can get a steal.
If you have a buyer for your property the real work begins in many ways. It isn't all downhill after a meeting of the minds necessarily, because many of these accidental buyers are among the most difficult I have ever dealt with.
- They could not be as qualified as they think they are, because they haven't bothered to speak to a lender yet.
- They might not be very cooperative, because they think they are doing you a favor. This can create havoc in a transaction, because unresponsive or entitled buyers frankly suck.
- You could ruin your friendship. Ever do business with a friend?