How low will it go before it sells?
Article originally published MAY 31, 2005 –Reviewed and approved.
By Neil Jenman
Back in September last year, LJ Hooker at North Ryde had no trouble selling a home that had been the scene of a gruesome triple murder. Their selling technique was simple – say nothing.
When a family of devout Buddhists bought the home for $800,000 and later discovered that it was the infamous “death house”, they were told by the agent that they should have asked.
Yes, of course, doesn’t every buyer ask about recent murders at each home they inspect?
Fortunately, the Department of Fair Trading did not agree with the selling strategy and imposed a fine of $20,000 on the agent.
Following widespread publicity of the case, the LJ Hooker network kindly agreed to refund the $80,000 deposit paid by the buyers.
The home was again offered for sale, only this time another ingredient was added to the selling strategy – honesty.
The following statement now appears on all marketing material: “Notice to Buyers: This property is being sold under instructions from the Trustee of the Estate of the Late Teddy and Mary Gonzales. Mr and Mrs Gonzales together with their daughter were murdered in the house on 10/7/01.”
Now, remember, last September, when the murders were not disclosed to buyers, the home sold for $800,000.
But, once the murders became known, the home was passed in at auction in March for $715,000. It was then offered for sale for $850,000 with a spokesperson for the agent saying it should sell within two weeks. Go figure.
Well, at the end of May, the home remains unsold.
Yesterday it was announced that the price had been reduced by $80,000 – from $850,000 to $770,000. This, of course, is the asking price which often has little to do with the value.
The value of a property is the amount a willing and fully informed (what a great expression) buyer is prepared to pay.
For the death house, the highest price a willing buyer has been prepared to pay has been $715,000. And that was back in March. Since then, the Sydney market has become even tougher for sellers.
As most agents know, honesty can be a real sales killer.
UPDATE: It was reported that this home ultimately sold for $720,000. This means that homes where a gruesome murder has taken place lose about 10 per cent of their value.
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