How do YOU tell The buyer that the house they love is in the wrong spot???
FIVE years ago (2007) I had a buyer who fell in love with a beautiful, historic house that was notorious for it's "Issues". The former owner had major problems with the Village when she bought it. Local zoning laws were not so strict when the Village was first being built in the 17th and 18th centuries and there is now a mix of commercial and residential properties on this particular street.
This very beautiful old house was right next to a non-functioning gas station which was torn down and a new bank was being completed in that spot. I was guiding them carefully to buy another house on Elm Street, a street that was quickly becoming a very popular one for new buyers in the village of Southampton...and it was completely residential.
Because there was a bedroom that faced the street in the Elm Street house, the buyers could not get their mind around buying it---it was an exquisite, brand new house that had everything else they could want. it was beautifully detailed and in keeping with all other traditional homes. They ended up not buying that one.
The house they fell in love with was a beauty---originally built in the mid 1800's, it had historical value and can never be altered or torn down--which was perfect for them. They are very much into the idea of protecting the older houses here in the Village, as was the former owner.
The former owner carefully restored the whole house while she owned it, pouring money into it that she probably never should have. The reason I say that is the following issues were unfolding during her ownership:
- During her ownership, there had been a fatal motorcycle accident in front of the house. A lawsuit ensued against Southampton Village and even though it did not involve the home owner, she had allowed the survivors of the person who died in that accident, to erect a "headstone" of sorts right inside the hedgerow in front of the home. It was not too big because it had to be approved by the Southampton Village signage laws...but you could see it clearly.
- The new bank that was under construction was having a terrible time with the Village over the lighting that they wanted in the big parking lot. "Light pollution" was the claim against the bank and they were pressured to lower the light towers and lower the wattage too. They also were required to plant triple hedges on the residential side of the property--These problems went on for 2 years while the owner struggled with the Village Zoning Board of Appeals. They finally finished construction but it very clearly is a bank next door.
- The house was on the South side(good) of the road but there was another street that runs perpendicular to said road and as it opened onto this road, the traffic coming South, faced the house directly--in other words lots of more light at night!
Even after my suggestions that these were issues they needed to consider, they decided that the house was worth it. They paid a healthy amount for the house and were very excited as they proceeded with the sale. I love to see happy buyers and I left them at the house feeling as though MAYBE I had been wrong about the potential "issues" and went on with my life.
Last month, I got a call from the "new" owner---they need to sell the house because his business had fallen off badly. As I did the recent comps of the property I shuddered at what I now had to tell this homeowner.
Not only did he overpay at the time (it was the top of the market in '07), the "issues," were now a glaring negative to the possibility of re-sale and ultimately needed to be taken into consideration when pricing the property. As I carefully did my research, I got the horrible feeling that I sold them something that they will never get their money out of. It was comping out at almost half of what they paid for it!!!
As I made the call to the homeowner, I made every attempt to keep it positive...as positive as I could. It was not a question as to what it should be priced at---it was a problem and I had to tell him that.
He was not very happy as I explained what had happened to the prices here in Southampton Village; I reminded him that he did buy at the height of the market. We had a brief conversation and then he told me his business was turning around and he would wait---since it was a third home for him he had other options. I was sick to my stomach after that phone call...
WHAT WOULD YOU HAVE DONE IN A CASE LIKE THIS: IF A BUYER WANTS A HOUSE IN A VERY DIFFICULT PLACE WITH MAJOR ISSUES AND DOES NOT WANT TO HEAR YOUR CAUTION??? In my case, I felt that I did everything I was required to do by law, under the circumstances. I was working for the seller at the time. I had a fiduciary responsibility to the seller and at the same time treated the buyer fairly and honestly...IS THERE SOMETHING ELSE I COULD HAVE DONE????
**ALL INFORMATION AND CONTENT IN THIS BLOG IS ORIGINAL TO PAULA I. HATHAWAY. The views expressed herein are my personal views and do not reflect the views of Douglas Elliman Real Estate
Paula I. Hathaway, Senior Broker Associate, Douglas Elliman Real Estate
Southamtpon Village Real Estate Specialist since 1995; Also Specializes in North Sea, Noyac, Water Mill and Bridgehampton, New York
Diamond , Gold and Chairman's Circle Awards; Top Producer since 2005
Click here to see my Hampton's website to see all my listings; please email me or call me for all your real estate needs in Southampton, Bridgehampton and Watermill: http://www.elliman.com/paulahathaway
MY REAL ESTATE SHOWS: