Fact or Fiction: Sellers are Accepting Offers of 50% of Asking

personally, I think the story is a hoax and is being spread by renters looking to crash the market. But that's just me.

It is true that it is a rumor. Whether fact or fiction remains. The story is from the Hamptons, 10 properties, listed $3mm-5mm, bidder bids $1mm for each property, gets hit on 2, buys 1. Rumored to be a currency trader at a large bank.

NY Magazine recently wrote about the same rumor, but this time it was for Manhattan:

Absurd Unsubstantiated Anecdote
Over the last few months, brokers have been passing around an anecdote—a ghost story, really—that I’ve heard in several different variations. A cash-rich buyer looks at a property and offers 50 percent off the asking price. Later, it turns out he did the same thing at ten other properties, and—here comes the crucial part—one of the sellers actually bit. Though identifying details are hard to come by, because brokers don’t want to give anyone ideas, many say they’ve seen it happen.

Currently, its fiction come a year and beyond it will be fact :o).

alpine,

Pertaining to NYC not just Manhattan do you understand Lil' Man from NJ?

huh?

This is so absurd - why are people on this board still discussing percentage discount against asking??? If I have a property, the most recent comp is $500K, I price it at $1.2M, and a buyer bites at $600K, who is left holding the short end of the stick? I'm guessing most would agree it is the buyer... who got a 50% discount off ask. The percentage discount from ask is only as valid as the original listing price.

Why can't we focus on percentage below most recent comp, or ppsf, or some other number that tells an actual story...

because asking prices are more readily availble then sold prices, especially for people like me who are not SE insiders.

The best thing to do is just follow it rabidly. You get a sense of what is happening and what might be an appropriate price. The problem is that it is such a moving random target right now. When a down market stabilizes, there are still "deals" available if you're savvy (looking beyond the puce furniture), but if you've done your research you'll KNOW that they are good deals.

also, if someone made an offer of 50% of asking, I can't see a situation in which the seller would not counter. Maybe the seller would not counter within 10% of asking, but 50%? Of course they are going to counter!

google enzo morabito for at least some of the story about one of the things that has happened in the Hamptons.

I did. Can you provide the link? I can't find the story it on his website.

it depends on the crazy high price they orignally listed for...360 East 72nd a studio listed for $535k (crazy) is now listed for $399k...it's not 50% but it's a big price cut.

http://www.27east.com/story_detail.cfm?id=191961

that's what I was talking about - the auction process that he held

"It is true that it is a rumor"

priceless.

Bab's changed the face of RE marketing in NY in many ways. One was to get things published in the NY Times and then show them to their clients and say "see? I was right when I told you to price this studio at $7 million, but now the market for studios has changed and we have to drop the price to $400,000. look, it says it right here in the NY Times Real Estate section".

This is just the viral marketing equivalent. The reason brokers love this story is because they want their sellers to hear it, be scared *hitless by it, and take whatever offer the broker brings them and forget the bull**** the broker told them to get them to sign the exclusive in the beginning.

All rumors are true. I got one from my wife, who has a friend who has a friend....Who supposedly got hit on a $1mm bid for an apartment that was originally asking $2.5mm. I don't know how realistic the $2.5mm was or what the asks in between were.

30yrs:
thanks, I thought it was going to take w67 to get that one.
I be here all z week

"personally, I think the story is a hoax and is being spread by renters looking to crash the market."

does the market need help "crashing?" it seems to be doing fine by itself.

"I got one from my wife, who has a friend who has a friend....Who supposedly"

Your post lost all credibility after that sentence.

How so? I think the thread is all about what people have heard. Dude the shit you have written on this site, you are a documented buffoon who has nothing to say about anything.

easy rhino: throw him a bone, its not easy being unemployed in NJ.

For what it's worth, I find these stories to be absolute BS. Sellers are still in denial, and rational or not, most sellers would simply haircut the asking price by 25% rather than accepting a 50% below ask price. We can all argue that eventually they may end up at a price 50% below original ask, but I have a hard time believing someone would accept an offer 50% below ask.

So now you know.
It's all governed by the emotional state of the market.
Seller's agents want their clients nervous so they will drop their expectations. Nothing sells faster than a property that's priced right. Ask any agent, "what's your favorite sale? A quick one." This market picks up steam post capitulation. Currently, we are in the capitulation stage and growing impatient because...that's human. You watch,wait and, stay alert. That's how hunting works.

"That's how hunting works."

That's fine for buyers, but for Seller's it's a lot more like fishing than hunting. in fact, we may have hit the best analogy about the difference between being a buyer and a seller.

I think its true..brokers and sellers are scared stiff because the reality is this market is tanking. its not liquid like the stock market...RE is very chunky and moves in gaps. its very opaque..pretty soon the sales are gonna hit the tape and its gonna be ugly.this is 1980's japan all over. I think theres alot of payments coming due in June and we're going to see alot of defaults

Are you new here? Prepare to be attacked by bulls! Haha. They don't understand everyone doesn't have to sell to make a market...just some...and some will.

Haha Alpine must have posted something foul. Give it up and go home (to Jersey)!