Back To Blog

What the Pontiac Silverdome can teach us about the real estate market.


In 1975, the residents of Pontiac, Michigan spent $55.7 million to build their Silverdome dream home on 127 acres of pavement with a couple of trees and highway views. After all, they built it for the Detroit Lions and their friends to visit and play, like Madonna, the Pope, the king of Pop and Andrea the Giant.  And a Super bowl.

The proud owners had so many memories. So many family gatherings. Then a nasty divorce came when the Detroit Lions moved to - well Detroit.

Of course the family was being sucked dry $1.5 million a year to maintain this huge empty house. So they decided, time to sell.
And a buyer came in with a $20 million offer.

Well the owner had spent more than twice as much to build it so it must be worth more, right? And of course they believed there were gobs of buyers wanting to have 83,000 seats, plenty of parking and a blow up roof, right? So they turned it down.

They didn't take into account that the neighborhood, and economy began to change. Their neighbor Mr. GM had closed its 3.4 million square food house down the street along with 3000 of the kids who use to play in the Silverdome spending all of their lunch money. Seems up to 15% of the neighbors just didn't have jobs anymore.

So you got this huge house, getting older everyday that the family has abandoned it, looks kind of empty, a bit dank, not staged nicely, and is costing a over $4,100 a day to keep open.  A year later, and another $1.5 million in upkeep costs, they finally sold it for a whopping $583,000---that's right, about 1% of the original cost, and less than price of a 4 bedroom 3 bath home in the area on less than an acre.

Hmmmmm

So what does this teach us?

1) There is a saying in real estate that "the first offer is usually the best offer" --statistically this is true, whether in Pontiac, Michigan or New Hampshire.
2) In the end, the buyer determines the market value of your home.
3) An overpriced home listing will simply go stale. Chasing the market with small price reductions doesn't work. You lose most buyers after the first few weeks.
4) Homes on the market too long communicate to some buyers that there is something wrong with the property--so they move on.
5) Aggressively priced homes will sell much faster, with a better chance for multiple offers possibly achieving a higher price.
6) An empty home does not show well, period. Most buyers cannot picture their own furnishings in an empty space.
7) A messy home with too much stuff doesn't show well either. You want to show the house, not the stuff.
8) Unique properties are much more difficult to sell or to find a buyer for.
9) The buyer will only pay what they are willing to pay--not any more---even if they won the lottery.
10) What you paid for a house, what you put into it, what you owe or what you want to get from the sale does not matter to the buyer.
11) Denial of the current market conditions will not change reality.
12) You must consider the value to maintaining your sanity keeping your home versus the actual cost of maintaining it.
13) Going with an agent who tells you what you want to hear won't help sell your home if the market is telling a whole different story.

Pontiac lost over $20 million, $10million in tax revenues, and their pride.
I have yet to see an overpriced house sell,
I have seen houses that were on the market so long that they went into foreclosure.
I have seen divorce situations that left a house in shambles and go into foreclosure.
I have seen sellers go to several real estate companies with the expectation of getting the money nobody will look at their home for--and blame the real estate agent.
I have seen sellers reject good offers only to take a huge loss later.

In the end, our real estate relationship should begin with an understanding of the market, an understanding of what to expect, an understanding of your needs, and an understanding on how you and I can work together for a common goal--to sell your home--For the highest return in the shortest amount of time.

So give me a call, I'll come to you to save time.
 

 

Add Comment

Comments are moderated. Please be patient if your comment does not appear immediately. Thank you.

Comments

  1. removalist on

    After I originally commented I appear to have clicked the -Notify me when new comments are added- checkbox and from now on every time a comment is added I receive four emails with the same comment. There has to be a way you are able to remove me from that service? Kudos!| removalist http://www.extintoresmercury.es/index.php/component/k2/itemlist/user/121602
    • Smithd147 on

      I do not even know how I stopped up here, however I assumed this put up was good. I do not recognise who you are however definitely you're going to a wellknown blogger for those who are not already eddagdkfedfkdgfe