One important thing: I want to be clear that I mean no disrespect to the real estate agents we worked with. As I'm sure they would tell you, there's more to a real estate transaction than what is seen from the client's perspective. It's not my intent to undermine their abilities or integrity, or downplay the important role of real estate agents. I want to speak openly (although this is still an abbreviated version), so I've changed the names of everyone involved.
Unexpectedly Buying the Lakehouse
You likely remember that in June we bought the lakehouse. Our buyer's agent for the transaction told us that the only way the seller would accept an offer was if it wasn't conditional on the sale of our townhouse. Was that true? We'll never know. Frankly, I regret looping in that particular agent because the lakehouse was for sale by owner and, in hindsight, we likely could have sorted this out between both parties and saved a bundle of cash (we had to split our agent's fees with the seller for him to accept our offer). I think what soured me the most was that our agent kept bemoaning how little money he was making (about $8,000), which really frosted my cake given a number of missteps made by him. He also kept off-loading tasks (like communicating with the seller) to me, which really made his role very minimal. I gently reminded him throughout the process that we found the house ourselves. Some people take years to find a good lake property around here, but we knocked on his door with a listing in hand! He really irritated me but we did land the lakehouse, in spite of another interested party, so who knows what kind of magic he worked.
For Sale . . .
We hurried to prepare the townhouse for sale. In a rush, I interviewed four real estate agents and ultimately picked the agent who was most enthusiastic about the outcome. Let's call her Emily. Emily loved our house, proposed the highest list price, and was super confident. She had sold one of the most expensive (but not the nicest) units in our neighborhood, so I thought she had the magic touch. Her website was elegant and I liked her personality the best. As a bonus, she said she might already have interested buyers (nope).
We told Emily that we knew we had missed the busiest time for real estate and were well aware we might have to wait until the next spring for the right offer. We thought we were being realistic, but we were quite naive about the actual burden of owning two homes. She told us not to worry and predicted that we would be inundated with traffic the first weekend - maybe even enjoy a bidding war. We weren't. Not a single call. But the Monday after we listed someone toured the townhouse and immediately put in an offer, $15,000 below asking and with a closing date in advance of ours on the lakehouse. We didn't come down in price much at all, thinking that this offer was the first of many that Emily had predicted. In hindsight, should we have worked with the offer? Maybe. He ended up renting, so I'm not even sure how serious or eligible a buyer he was. But his offer haunted us throughout the process.
Then there were crickets . . .
The summer was slow for Ottawa real estate. After a $5,000 price drop and almost two months, Emily presented a second offer - for the exact same price as the first one! This time we listened to the market. After some negotiating we met in the middle, making the price $10,000 below our original price, but $5,000 above both offers. At this point, we were tired of showing the house; it felt really invasive to have stranger after stranger go through our drawers and use our bathrooms. Many agents left the doors unlocked when they left, which terrified us. We were anxious to sell - more anxious than we thought we'd be. There was one hitch: this offer was conditional on the sale of the buyer's home (let's call her Amy). We would be allowed to accept other offers, but Amy would have 48 hours to decide whether to waive her condition before we could accept a competing offer. Amy and her husband had separated and were motivated to sell, we were told. Amy's home would sell quickly, Emily promised. She was so confident because it turned out she was Amy's seller's agent as well (something she said was not the case when we first signed the deal). We were a little apprehensive because Emily had been confident our house would sell quickly too, but we wanted to believe her.
At the end of September, when the deal expired, Amy hadn't even listed her house. With no other offers in sight for our house, at Emily's suggestion we offered an extension. We were uneasy about this but felt stuck. I figured we had to at least give Amy a chance to sell her house - maybe it would sell fast once it was listed. Emily was confident it would work out, so we didn't discuss dropping the price on the townhouse. We had a few showings but it was slow. At one point Emily almost refused to show our house because she wasn't feeling well. She said she would tell the prospective buyers to look at the other homes in the neighborhood instead and if they still wanted to see ours they could reschedule. I was angry that she could be so cavalier. In the end she showed the townhouse, begrudgingly. She repeatedly told us she knew Amy would end up in the townhouse. I told her a million things could happen (Amy and her Hubby could get back together for all we knew!), so I didn't feel comfortable banking on that deal. We had to act in our best interest and try to generate another offer before the market really cooled. She wouldn't listen. Her website was updated to list our house as "Sale Pending," which we asked her to remove. It felt like she was fighting against us trying to sell the house to anyone other than Amy.
Competition Sells in 8 Days
Meanwhile, we weren't kept abreast of developments in our neighborhood. After another house with extensive updates was sold, we were informed of the listing. It sold for our original list price, thanks to some updates the townhouse didn't have, like engineered wood flooring throughout (we had solid wood on the upper levels and carpet in the basement) and forced air plus air conditioning (we had radiant heat). Again, we were frustrated. Had we known it was listed (and sold!), we would have dropped our price and stayed competitive. That house had a ton of interest and we could have received some of that deflected traffic. The agent who sold that house (whom we later hired) told us that Amy's offer likely turned away most people. Agents apparently don't like to show their clients a house that is tentatively sold. If a buyer falls in love with it, then has to wait 48 hours for another buyer to either pull the trigger or pull the plug, and is then told the house isn't available, it isn't only a crushing disappointment but can really hold up the process. Other fabulous homes can be listed and sold within that time, leaving a buyer with nothing.
With the market cooling even more as winter neared, the first refusal with Amy was again up for renewal. Wearily, we offered another extension because now we felt immensely grateful for the price she offered. At this point we really wanted to walk away from our agent who we felt was no longer working for us, but we kept being reassured that Amy's house sale was imminent and Amy desperately wanted our house. If we left our agent, the whole deal would crumble. You can imagine how shocked we were when Amy walked away! Emily unsuccessfully tried to explain to us how Amy felt the situation was a lose-lose for her. I believed it was a lose-lose for us: an offer from a buyer with no obligations to us, and yet the "pending sale" status made us undesirable to other buyers. I felt there was something our agent wasn't telling us because her explanation made no sense. At this point, we finally decided she really wasn't working for us and so we parted ways.
We tracked down the agent (let's call him Bob) who had sold the home in our neighborhood lightning fast and listed with him. He seemed great: honest, enthusiastic, previously successful. But once we signed, he pulled a bait & switch and we primarily dealt with his business partner (let's call her Cathy), who was far too chatty and never listened to us. We never would have hired her, not in a million years. Before we lost contact with Bob, he talked us down quite a bit in price: $25,000 below our original list price and $15,000 below Amy's offer. I really fought to list even $5,000 above his price (which had been recommended by other agents I interviewed at the time), but he was really adamant that his price was right. He pointed to our growing puppy and asked if it was fair to cram her in our tiny townhouse. He then scared us by figuring out how much it would cost to hold onto the townhouse for six more months, and warned us that housing prices could drop if we waited until spring (which we'd thought was our plan B for a sale). He also said we'd need to subtract our monthly carrying costs from any price we got in the spring so even if it was higher, the money we'd make would be the same. Hmmmm. He made a good case: we were burdened with the two mortgages and other costs. When we figured out on paper whether we could carry the two homes, we decided we could, but it certainly was a whole different story in real life. Unexpected costs arose and budgeting so tightly (can we afford cheese? nope) was stressful and draining. We had to dip deeper into our savings than I felt comfortable with. The new low listing price put us below some of the truly terrible homes in our neighborhood, including former rentals with commercial grade carpet. It was disheartening, but of course our price created a flurry of activity with multiple showings a day. Within a few days, Bob brought by his own clients (let's call them the Smiths) who, coincidentally, could not afford a penny more than the listing price he was so adamant about. We really, truly want to believe this was a coincidence. All of a sudden, other showings stopped and his clients presented an offer. I kept pressing for feedback from other showings and was provided none, only the offer from his clients.
The day we received the Smiths' offer, Emily contacted Bob to tell him Amy wanted to put in an offer again. Can you believe it?!? She had finally sold her house and was almost ready to purchase ours. She must have been so thrilled that our house was now on what I jokingly referred to as "clearance". She came in with a price only slightly above the offer we had on the table (about $13,000 below her previous offer), but because Bob was offering a discounted commission as the representative for both parties it worked out to be more or less the same. She offered to match or beat any price they offered but we just couldn't do that to the Smiths. They had supposedly experienced a disappointing turn of events trying to buy their first home and we felt some camaraderie. From our point of view, Amy had enjoyed months of putting our house on hold like a sweater at Winner's, only to change her mind, so to me it felt immensely unfair for her to benefit from the poor bargaining position we found ourselves in because of her ongoing offer. Ultimately we knew it wasn't her fault, but we also thought that we'd feel oogie about her getting the townhouse for such a steal after all that.
The deal hit some snags, but ultimately the Smiths bought the house and moved in at the end of January. Afterward, Emily told us that Amy would have gone back up to her original price. Why even tell us that?!? That's just salt on the wound, and there is no way to know if that was even true. I don't believe it. After Bob had spoken rather harshly to Emily, I emailed Amy to apologize. In case the Smiths backed out, I didn't want to burn the bridge that Bob felt so comfortable lighting up. It's at that point Amy said she would meet/beat the Smiths' offer but she made no mention of offering even close to her original price. If she had, I'm not so certain we could have made such an ethical decision regarding the Smiths - I likely would have wanted to ditch them and go where the money was! Amy could have had the townhouse for her original offer. In the end, we shouldn't have made such an emotive decision: the Smiths turned out to be truly unappreciative of the sweet deal they had snagged and how lucky they were that a bidding war was stifled. After an unpleasant incident, I regret doing them any favors. We shouldn't have empathized with them.
In any case, Bob certainly did not encourage any type of bidding war either - or even entertain Amy's offer. Was he trying to ensure a sweet deal for the Smiths? He knew they couldn't afford a penny more. At the end of it all, we felt unsettled. We sold, yes, but for much lower than we thought. And, eerily, in the end Emily was right: Amy sold her house and could have ended up in the townhouse. If we'd stayed with Emily, we might have ended up with a better price.
We met Amy when she bought some furniture from us and she seemed really sweet. She ended up renting a little apartment and Emily told me she was deeply disappointed by missing out on the townhouse. Amy and I had such similar aesthetics, it was truly a good match. I genuinely hope she finds a beautiful home when she begins looking again. I really wish her the best. And I really wish I could have met her during the process, just sat down with her and chatted. Keeping things so anonymous, with dribs and drabs of information filtered down to us through Emily made it easy to cast someone as the "bad guy" and feel affronted and frustrated. Without the anonymity, I think perhaps we all could have gotten what we wanted.
I dealt with most of the real estate business and I feel like I let Hubby down by steering us wrong. I'd originally wanted to list the home myself but when buying the lakehouse happened so quickly, it felt like too much, too soon. I wish I had gone ahead and tried, though. But then, who know, that could have ended up worse! I'm sure there are many fabulous agents out there - and Emily and Bob certainly have made other clients happy - but if we ever use an agent again, I have a self-imposed list of criteria:
- I'd never agree to my agent working as the agent for the other party as well. We saved a lot in commissions but it felt like neither of our agents were really looking out for our interests.
- I'd never pick an agent by simply interviewing them. They all say the same things: "your house is beautiful, here is a slide show explaining how awesome I am". From now on, I'd prefer to have a family or friend's recommendation.
- I'll try not to be so emotional. I don't need a connection with my agent, I need someone who can deliver and work in my best interests! My second choice had been an agent who was so talented he sold what looked like a meth lab for a seriously good price but I didn't hire him because he'd dropped out of his PhD program and I didn't want that bad juju around me so close to my defense date. Now, of course, I feel ridiculous about that decision. He had a proven track record, which I didn't value like I should have.
- Next time I'll take more responsibility for how the real estate transaction unfolds instead of relying on someone to make magic. If we'd paid attention to the market and dropped our price by just a little earlier in the game, it could have been a completely different story - we could have sold for $10-15,000 more.
Ultimately we did sell (in about six months), so it's a success story. We made back all of the money we put into the home (and the real estate agent's fees), but didn't make a dime on our sweat-equity. Luckily we'd been overpaying our mortgage every month, so we pulled a lot of equity from our home which was a real treat (and lessened the sting). More valuable than that: we learned a lot in the townhouse about owning a home, renovating and decorating, and buying and selling. I feel a little more savvy. Most importantly we enjoyed our time in the townhouse. We'll always have fond memories of our time there. I don't truly believe it, but sometimes it feels like things happen for a reason. It's tempting to say we should have worked with the first offer we received, but if we had sold the house sooner, who knows if I could have successfully defended my PhD dissertation under the strain of packing and moving? If we hadn't pounced on the lakehouse without listing the townhouse, who knows if we would have found something as perfect? I've seen Sliding Doors.
We recently checked MLS and it doesn't seem many (maybe any!) homes have sold in our neighborhood since we sold. I think our sale price really messed things up for our neighbours because potential buyers will, for the next year, say "look, this house had marble counters in the bathrooms and hardwood floors throughout and it sold for $5,000 less than this one with ratty carpet and 1970s laminate". Sorry neighbours! We feel pretty darn lucky that we sold and moved on when others did not.
We're happy in the lakehouse. When the sun sets, and the snow covered lake glows pink, we know it was all worth it because it got us here. And, hey, we can afford (wine and) cheese again!