When a person decides to purchase real estate with a view, they often times begin asking the question, “how much should a view be worth?” That very question is age old when it comes to buying and selling real estate. No one wants to leave money on the table when it comes to selling real estate, and no one wants to pay too much when it comes to buying it.
A set of buyers wanted to buy a condo with a view. As so often is the case in real estate today, very few comparible sales existed to help guide a decision on offer price. The comparible sale that did exist, was in the same condo complex as the condo with a view that the buyers wanted to purchase. However, the comparible sale was approximatley 200 more square feet, came with a nice furniture package, and one extra bedroom. The condo with a view, the buyers wanted to purchase was listed for 90k more than the recent comparible sale. Was the view and location worth $90,000… After much research and consideration given to the thought of a appropriate offer price, the offer was made by the buyer to the seller. The details of the negotiation are not of paramount importance to the point of the story. What is important is that in the long run the buyer and seller could not get together to find mutual acceptance of a offer or counter offer. A dissapointed, well qualified buyer, and a dissapointed seller-minus a sale is what resulted.
A few realizations were derived from the occurence described. A buyer will only offer so much of a premium when it comes to a view. At some point a buyer, no matter how much they may want a property will submit to logic. On the other hand, sellers will only discount their real estate investment so far. Even in a buyers market and at the risk of chasing the market, sellers may be willing to let buyers move on and purchase the next property. With differing degrees of seller and buyer motivations, varying properties, and ever changing market conditions, the bottom line is that each scenario will be diffrent.
Advice to a buyer may be to temper expectations by not becoming overly attached to a property before actually closing on that piece of real estate. Advice to a seller would be to capture buyers in a market that is still decling to some point in most instances.
What is chasing the market? Read my blog post titled, “Selling A Home In Sunriver – Are You Chasing The Market” to find the answer!