Blog: R.E. Tales
Hey, not every place is pretty.
Keep It Local
This is something I have learned the hard way: keep your practice local. Well, relatively local. Every so often I run across a property that is definitely not local. Maybe the owner has met me , likes the way I do things, and begs me to take the listing on their property even though it isn’t nearby. Maybe it’s a friend who lives out of the area. Maybe the price is so low I think I won’t have to make too many long drives to get it sold. Though I should not admit it, I can be easily swayed by opportunity. I learn the lesson again and again.
My first year at this, I listed 2 properties located 3 hours to the Northeast and another which was 4 hours to the northwest. I remember the trip well as when I got to Saratoga, my exhaust manifold broke and I sounded like a race car driver for the next two days, amazed no police hauled me in and impounded the car. Hardly anyone called on the places and I only showed the two once. At least I did not tie them up in an exclusive contract, so no owners got made at me for such poor performance.
Also early in my career, we took on a salesman from the central and lower Hudson Valley. He went right out and got several good listings. Well, they were good for everything but price. Compared to property in this area, they were double in price. Compared to properties around them, those prices weren't bad, so it seemed to Mort, my broker, that we ought to be able to nip off a few of these. They were obviously nice farms. Only no one called. And this went on for a very long time. I drew the conclusions, probably perfectly correct at the time, but less so today, that most of our buyers then didn’t care where they lived. They cared about the land, the buildings and the price. And the price on these places scared them off. In the very few opportunities I had to speak with folks who called on them, I’d explain they were in a very different area, where prices were far higher. But the milk price there was only slightly higher than ours and they could not see it working, not when they could get a similar place here for half the amount. Those farms just did not look good in comparison with the others we offered. Folks here were underselling them.
Finally, I got a call on one. The fellow wanted a particular place and I quickly returned his call Was this my opportunity for a big commission? Talking to the buyer, I got brought back to earth quick enough. He sounded young and naive. Then I found out he had almost no money. “Then, why did you select such an expensive farm?” I asked, genuinely perplexed. “Oh, I thought I’d might as well start at the top”, he said. This was taking naivete to a new level.
He had not given a thought on how he could pay for the farm. It was the most expensive we offered then and he’d assumed it was the best, for that reason alone. He’d never thought how it could be financed. No bank is going to loan 100% and they are not going to loan to someone who is wringing wet behind the ears.
I had a friend from Hawaii list his place with us informally. We’d made arrangements for a local broker to do the showing and to keep us legal as we were not licensed in Hawaii. I had no idea how that was going to work out, but we did get calls. No showings of course. But it sold right away. Then one of my customers asked me if we could help them sell their place in northern Maine. If it would sell, they could buy down here. I explained that this was way too far for us to show and we made arrangements that we would get a straight advertising fee upon sale, not a commission. I asked lots of questions of them and received lots of photos so I could field calls intelligently. We had a few calls and one showing, which went poorly. Then by mutual consent we gave it up.
Years later, I got a listing call from the Castletons, who had very large farm near the Canadian border. I talked with them for a good while and decided I’d take it on. It was interesting and I wanted to see if I could pull it off. I went up there, visited everything, took copious notes and tons of photos. Then they gave me a price. This was a truly beautiful place, impeccably kept, and very large, but they were overpriced by a factor of 2. My mistake was not establishing the price before I went up; by coming there I’d kind of committed myself to the effort. Try as I might, I could not make them believe that just because their name was Castleton (they were respected locally, as they deserved), it did not make the farm worth more to anyone else. Sighing to myself, I figured this one would be for the long haul as they were people who had to learn by experience, not from advice I could give them. Since it was so big, we got a pleasant number of calls and many of them resulted in showings, eight hours of driving each time I made the trek. It took another 4 hours to show the property. But the buyers were not dumb and they kept their hands in the pockets with their checkbooks carefully hidden. The Casteltons eventually lowered the price - over a year later - but not by much, Then, with more time, they lowered it again. Then the bank foreclosed and a neighbor bought it for cents onto dollar. A firesale price. Their pride cost them dearly; I could have saved some of their equity had they been willing to listen to reason.
At the same time, I listed 2 smaller farms in the next county west. We were to do the advertising, vet the customers, provide information to them, set up showings for the owner to do. We’d also do the contrast and keep the legal work moving forward. It didn’t take long for the owners to get tired of showing their farm and not getting a sale. They’d have to rearrange their personal schedule to accommodate the customers, wait for them to arrive and deal with a few who never arrived yet never told anyone they’d changed their minds. I actually got a buyer for one farm and then - you can’t makes this up - the guy decided to buy a home the owner’s mother wanted to sell. A house in town, not a farm. So he never got his place sold and I never got a commission. But the buyer got a house. Whoopee.
A year later, I learned of a property that sounded to too good to be true and made arrangements to visit it, over next to Lake Champlain. Well, it wasn’t as nice as I’d been led to believe but even so, it was a great buy. The land was nice enough but there were suspiciously few farmers in the area. I wasn't sure what to make of that. Pressure from vacationers? We listed it - only to learn two weeks later that they listed it exclusively with a local agent. How could they forget this? It made us look terrible, it’s a total breach of protocol. The other agent was really nice and offered us a Co-Exclusive on it. We found a cash buyer right away, someone I’d worked extensively with a few years prior. He’d seen an ad, called me, then drove up from Florida to see it. The sellers hemmed and hawed, then sold it to someone else, someone they knew. We didn’t make a cent - I don’t know about the other broker. I learned a year later that their deal did not work out (it involved some sort of rent), but by then, I’d had enough of that place and thought I’d never see that town again.
That lasted a few months, then Paul Brion called. We’d been talking about property over this way for a while. He asked me to list his place. Like a fool, I went up to visit and decided I could sell it. He owned 100 acres, but cropped 1000, all of it totally rent free. Paul is a good farmer - you could tell it was land he used just by looking at it. Better crops than any neighbor’s. He had good markets for his feed and was making a lot of money. That brought customers in and I showed it quite a few times. Then Paul recognized he’d never made more money anywhere else and decided to stay. Disappointed, I couldn’t blame him, he really was best off to stay.
Then Jake Calhoun called, wanting a place. We found him one and he asked us to sell his property for him. Only he was in St. Lawrence County. I went up to look at it. He’d made a local reputation for the quality of his beef and he wanted more of a farm, and in a more affluent area (which St. Lawrence County most decidedly is not). The “farm” was barely worthy of the name, a lot of woods and just a bit of wet and rocky pasture. But a nice home, frontage on a great river, and a reasonable price. He would do the showing and we’d do everything else. He also listed another property with us - a freestall, a bit run-down, on 14 acres, on a major highway, with ho home. Who is going to want something like that? To my amazement we found a cash buyer for that right away and the sale went like clockwork. But no one would call on the farm and Jake finally gave up on us a couple of years later. I think he’s still there. It’s just the wrong area for our customers.
When a place is closer, we save a ton of travel time and gas. We know the local market, who to recommend for services (lawyers, inspectors, banks, contractors, feed dealers….) and we know the ins and outs of life here. We can answer customer’s questions and help them after the fact. We know what the good buys are here and can make useful recommendations to both clients and customers. We can authoritatively field concerns about weather, jobs, schools, zoning, shopping, hospitals, all that sort of stuff. We know who the good lawyers are and who to avoid. Buyers can come to us and see several places in a day, not just one. When you work out of the area, none of this is the case.
There were several others I could mention. I’ve told you about every single sale I made out of the area, all one of them, the lucky one for Jake. Go too far from home and you just handicap yourself and don’t help anyone else. On the other hand, my everyday local area is 5000 square miles….
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Some blogs are designed to amuse; others can be an immense help. All are interesting.
After 40 years, I've learned a lot, & acquired unforgettable experiences. Follow these long enough and you'll eventually get the whole book. (Names probably changed, for obvious reasons.)