Negotiations are living beings. They change shape in ways that are imperceptible when you live with them every day. Step back and see them as a stranger would and the loss of perspective is obvious.
When, in the spring of 2008, we got a second offer to buy our house, we were focused on three things. What they wanted to do with it. What they wanted to pay for it. How long we could stay. The third factor became so important to us that the deal looked as though it would fall apart because the buyer wanted to move more quickly than we did.
As we learned, worrying about irrelevant truths is very expensive.
In our ideal world, we wanted to spend one last summer in Chicago with our dogs and then move East. There was a trip to Italy to celebrate my in-law’s 50th Anniversary. Twenty four years of living in Chicago to say goodbye to. And an unknown future we wanted to delay.
At some threshold change scares all of us. And the known is a powerful magnet that distorts the blinding obvious even further. As we entered the crucial stage of the negotiation, we could no longer see the true shape of the deal or where it was likely to lead us.
Find a buyer who loves the house. Done. Get a great price. Done. Move East. Hold on, could we talk about that please? You see, we’ve got this trip to Italy, and we need to say goodbye to our friends. And summer is so great in Chicago.
You already know it’s going to end badly. It’s so obvious.
As it turned out, the bill for structuring the deal so that we could spend those extra ten weeks in Chicago was $450,000. I hope we enjoyed those ten weeks. I hope they gave us a lot of comfort about the change we were about to confront. Truthfully, they’re a bit hazy. Surprising, since they cost us $45,000 each.
If I tell you we spent three of them in Europe, and that for all of them we were also paying rent on a house on the east coast, and you’ll wonder how we dare sell our advice to anyone else.
The best lessons are the ones we learn ourselves. And in this case, we paid the price so you don’t have to.
By focusing on the least important issue and making it the most important, we lost sight of our priorities. Sell the house. We didn’t see the changing economy and crashing real estate market ahead. But we didn’t need to. We just needed to be committed to a decision we had already made. To move.
Once we lost sight of that we lost. The buyer wanted to get in quickly. Instead of using that to negotiate a clean contract, we substituted a delayed closing for a sale contingency on his place. Instead of riding his excitement about living in our home during the summer, we dissipated that energy and gave him time to think about his own sale price.
Ultimately, we all lost. After being told by everyone he could sell in a week, he refused to lower his asking price to get a sale. And six months later, neither of us had sold anything. We eventually all agreed in November that this wasn’t going to happen and we cancelled the contract.
Last I heard, he’s still waiting. And despite the fact he did finally lower the price, he’s now one of a dozen apartments up for sale in his building. On a monthly basis, his apartment probably costs him triple the carrying costs of our house. Lose lose.
We finally moved east in late August. It was a quicker adjustment than we had thought possible, and Chicago seemed a long way away. Except for the house we owned.
By the time we reached Christmas, the housing market had fallen twenty percent. That, our broker thought, was not yet the bottom.
As it turned out, she was right.
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