An International Dilemma
An International Dilemma
Location: Grass Valley, Calif.
Lot size: 9.87 acres
Extras: Stunning landscape with a little spring that could be developed into a small pond, an upslope with a nice level area for a building site, a paved road, and power and telephone lines.
THE CHALLENGE: Before starting a career in real estate sales in 1980, John Daly, CRS®, GRI, SRES®, a sales associate with Coldwell Banker Grass Roots Realty in Grass Valley, Calif., spent two years teaching English, social studies, and photography at the Colegio Franklin Delano Roosevelt, part of American School of Lima in Peru.
His bilingual skills proved useful in November 2008, when a Panama-based lawyer called the CB office looking to sell an inherited parcel of land in Grass Valley. The linguistic, cultural, and legal challenges associated with selling the land on behalf of a Panama-based owner would require Daly, area vice president for the Northern California CRS Chapter and 2007 Northern California CRS REALTOR® of the Year, to dig deep into his arsenal of sales tools.
The client received the land, which had been in his family for 60 years, after a relative in Florida died.
"He didn't expect to inherit the property. But he did. And for some reason," Daly says, "the trust was set to expire Aug. 31, 2009."
With 10 months to find a buyer, Daly felt confident. But as winter slipped into spring and summer arrived without a buyer in sight, the experienced associate started to feel the heat. "We needed to find a way to get the property out of the trust before the deadline," Daly says.
What approach did you take to overcome the challenge?
DALY: The property had been in my client's family for many years and changed hands several times. So one of the first things I did was to have the land surveyed and the corners marked. With the trust having originated in Florida, the new owner in Panama, and the property in California, I wanted to make sure everything was in order. This was a complicated transaction.
I put together a bilingual support team. I found a Spanish-speaking lawyer locally to help the client rearrange things in the trust, which had not been recorded correctly in California, and worked with a lawyer in Panama. I also found a Spanish-speaking escrow officer. The client, the lawyer, the escrow officer, and I were in constant contact, sending e-mails back and forth in Spanish.
As the deadline approached, we dropped the price from $185,000 to $150,000. We dropped it to $105,000. I really thought at $105,000 this was a real giveaway, a great deal. But there still wasn't any interest.
Just before the August deadline, my client suggested we sell the property to a friend of his, who owns a science foundation that monitors water quality in the oceans and rivers of Panama, to get it out of the trust before the deadline and resell it under the new ownership. I discussed the idea with my broker and the lawyers to make sure we were not doing anything that would have legal or tax-fraud ramifications. They said it should be fine.
My client and his friend made a deal to transfer ownership for $20,000. The deal included a bonus for the science foundation, but the specific terms of that transaction were between the client and the foundation. We closed escrow with the foundation deal on Aug. 28, just two days before the trust deadline, and I put it back on the market a few weeks later. Coincidentally, after 10 months of trying to sell the land, with no interest, an agent from another office brought in a buyer.
What was the selling price?
DALY: We opened escrow on the parcel with the foundation as the owner Sept. 22, 2009. It closed in October for $85,000.
Can you tell me about the buyer?
DALY: The land was purchased by a couple who plan to build a house on the land.
How did the owner find you?
DALY: The owner contacted a friend of mine who knew I spoke Spanish. I had high school and college Spanish and worked as a high school teacher for two years in Peru, which was enough to get me to the point where I speak pretty good Spanish.
The funny thing was that when the owner flew in during the first transaction, we were in and out of the office for several days chatting away in Spanish. And the receptionist told me that many of my colleagues had heard I spoke Spanish but weren't sure I did. Now, they know that I actually do.
What was your local housing market like at the time?
DALY: The market for houses was slow, and land was almost impossible to sell. So this was a tough deal.
What techniques did you use to market this property and how much did you spend?
DALY: The majority of my marketing these days is on the Internet. I put a listing on Craigslist and Postitos, a classified listing site that's zip-code–based and that sends listings to Craigslist and other similar sites. I did some local print advertising and made fliers that I distributed to brokers. And I sent mailers to the neighbors and my sphere of influence. In total, I spent about $800.
How many times did you show the property?
DALY: We showed it collectively about 20 times.
What do you attribute to closing the deal?
DALY: Not giving up. Closing this listing required real problem-solving skills. I had to put together a bilingual team and look for new solutions to the series of problem presented by this transaction.
What was your closed sales volume last year?
DALY: My closed sales volume last year was more than $5 million.
How did you get started in real estate?
DALY: My father owned a real estate company in Los Altos, Calif. Before getting my real estate license in 1980, I taught high school in California and overseas in Japan and Peru. In fact, I met my Spanish-speaking wife, who is originally from New Jersey, while I was teaching in Japan in 1971. When my wife and I came back from Peru in 1977, the San Francisco Bay area seemed crowded. So we traveled throughout Northern California looking for smaller communities that were as vital, active, artistic, and high-tech as the Bay Area. Nevada County turned out to be that community.
Do you have a specialty or niche?
DALY: I don't have a specialty. In a rural county, you really have to be able to do everything from residential to land to farms and ranches to gated communities with lakes and golf courses.
What lesson did you learn from this?
DALY: A lot of agents might not have taken this listing because of the difficulties it presented. But our job as sales professionals is to be of service and help the client — no matter what the difficulty. So instead of being afraid of challenging transactions, we need to find creative ways to work with the client and resolve any issues.
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