I had known David for a few years. He is not a careless man. Quite the opposite, he is someone who researches, compares, checks. When he decided to invest in Bucharest, he did it after half a year of thought. He read articles, talked to people who had already done it, visited the area several times before signing. He was not in a hurry.
He sent me a link on WhatsApp, with one sentence:
“Look. This is the market price.”
I opened the link. The Romanian listings site - <a href="https://www.linkedin.com/redir/redirect?url=http%3A%2F%2Fimobiliare%2Ero&urlhash=J6CF&trk=article-ssr-frontend-pulse_little-text-block">imobiliare.ro</a>, the local version of Yad2 (Israel's classifieds site). Three apartments in the area, all priced similarly to what David was asking. He was sure he had closed the discussion.
I said to him: “Give me a minute.”
The apartment was in a reasonable neighborhood, not the city center, not the periphery. The kind of place people look to live in because it's accessible, quiet, not too expensive. When he bought, the market was rising. The logic sounded right.
He had done what is called here in local slang an “Israeli renovation.” I didn't invent that, it's the locals' definition. What it means: doing the bare minimum necessary for a tenant to move in. Paint on the walls, new parquet flooring that looks decent, an IKEA kitchen that works. Not a renovation that raises the value of the property, a renovation that makes it possible to occupy it.
He found a tenant, collected rent, and did the calculation in his head. A few years ahead, exit. The profit is clear. Surely.
Now the moment had arrived.
He came to me with a price he wanted to get, and a request that I find him a buyer. I heard the number, and my old habit immediately kicked in, to open a window and check what is happening in the market.
I took his data. Size, floor, neighborhood, condition. And I checked what exists on the open market at that price.
I found fully renovated apartments. I found relatively new projects with parking. I found properties with a clear history and orderly documentation. All in a price range not far from what David was asking.
I knew I could not recommend that my client buy from him.
I told him this at eye level. Not sharply, not critically, simply as a fact. “David, at this price, I can offer my clients better options. I won't be able to promote your apartment.”
He didn't like it.
“How can you say the price isn't right,” he asked, “if there are three apartments similar in data in the same neighborhood at the same price?”
And then he sent me the link.
I opened the link. I checked the first listing, clicked on the date. Four months. I opened the second - five months. The third - three months.
Three apartments. Three people holding on stubbornly. Three listings that don't move.
“David,” I told him, “look at the dates.”
A brief silence.
“They want more than the market is willing to pay. And you see in them proof that your price is right. But they are not proof. They are precedent that at this price, the apartment sits.”
He wasn't persuaded. “They sold cheap,” he said, about the closed transactions I had shown him. “I don't have to sell cheap.”
Absolutely true. He doesn't have to.
He turned to a broker. One who asked no questions, who advertised at whatever price he asked, who promised to try. The listing went live. A week, a month, two months. I know because every now and then I go through the listings and see ads for sold apartments.
David's listing is still there.
In the end one of two things happens. Either the price comes down, slowly, painfully, after half a year on the shelf, to something the local market is willing to pay. And then the deal moves. Or another Israeli shows up. Someone who didn't check closed transactions, who trusted the seller because they speak the same language, because there is a feeling of “one of ours.” And then the deal closes close to what he asked.
An Israeli sells to an Israeli.
I'm not judging it. I'm describing it.
The problem is not that David is greedy. He isn't. The problem is that he measured “market price” by what others are asking, and not by what actually closed. In real estate, and in life generally, the difference between an asking price and a closing price is sometimes small. And sometimes it's half a year on the shelf.
If you are considering selling a property you bought abroad, before you set a price, check not only what people are asking. Check when the listing was posted. Check what closed. These two questions are worth more to you than any appraisal.
Stories are based on real situations, with identifying details changed. Not legal advice.
Translated from the Hebrew original. עברית