A Novel Approach

A new listing came up last week at 231 Barkentine listed by Jeanette Cook of Coldwell Banker for $999,888. It’s a very large (3873 sq ft) home that could easily have 7 bedrooms…should you need it. The house has just about everything, including a pool and all of the work was permitted. When I first saw it come on the market the price really surprised me! Considering what’s offered here, it sure seems low.

What’s the catch, you ask? The total loans on the home are $1,275,000 and the house was appraised in October for $1,350,000. According to the listing agent, the seller won’t accept an offer for anything under $1,350,000.

Why the asking price of $999,888? It’s a novel approach to generate interest in the house and hopefully get offer(s), which then will presumably be countered at $1,350,000 if they’re lower than that. It’s an approach that I haven’t heard of before, and I think it’ll be interesting to follow this listing and see what happens. Some questions do come to mind, such as, what happens if the buyers can afford $999,888 but can’t afford $1,350,000? Like I said, it’s going to be interesting to watch this unfold. This market is certainly changing and we’re likely to see all kinds of novel approaches in 2009. This’ll probably be only the beginning.

 

Comments

  1. Seems like the approach itself is not novel, to try to generate interest and hope to get multiple bids. I’ve seen this done here in SF fairly successfully by a few listings in the past. But the difference between the list price and the expected sales price here is way to huge. In this climate I’d most likely bid even lower than the list price. Maybe I’m crazy, but I have a hard time thinking someone would volunteer to give away 400K just because they think that’s what the house is worth. It’s almost deceptive too. What if I offer them the list price? They are sure to come back with another price they expect. That’s like buying an apple listed for 99 cents only to have the checkout clerk tell you that well, that apple is actually $3. Drugs much?

  2. Jim Minkey says:

    No question, the concept of a low list price as “bait” is nothing new. What’s sort of unique here is the stated minimum that the seller will take…up front. Usually with “bait” you generate interest but you’re willing to accept what the market bears.

  3. I will probably tell the checkout clerk “I dont want the apple” 🙂 But hey, thats just me… maybe someone wants the apple bad enough??

  4. It’s still on the market, and I am glad we did not bother to check it out.

    It’s shady practice!

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