Five Thousand Saved and Forty Thousand Lost

By Brian French
Posted Wednesday, Jan 30, 2008

I was talking to a client the other day, and he was telling me a story about how he tried to buy an investment property years ago from a for sale by owner.He told me that he found a building that was in good condition, a decent location, and the numbers on it looked pretty good. He made a couple of offers on it, up to within $5,000 of what the owner said he would take. They were at a stalemate and neither party was going to budge, so the deal didn't go together. A year later he went back to the owner of the property and gave him his same final offer. The owner was still not willing to budge. A few weeks passed and the owner of the building sold his property to a buddy of the buyer at his price which was only $5,000 higher than what the original buyer ever offered. Fourteen months passed and the second buyer sold the building again for $40,000 more than what he paid for the property. So by not increasing his offer, the original buyer saved $5,000 but lost $40,000. When negotiating on real estate, take a look at the big picture. Sometimes it is better to take a look down the road and not what is just in front of you. My client has decided that he has learned an expensive lesson and no longer wants to go down that road alone. By the way, we just helped him make $60,000 on the sale of an investment property.