You are moving to New York City as you have got a new job offer there. You have been wanting to move to NYC for years and are really excited about this opportunity. You really want to live in SOHO, close to Broadway street. You applied for this job a year ago and got an interview 4 months after and it took the company 8 months to go through the selection process and finalize the offer. To get ahead of the game and knowing that most likely you would land a job in NYC, you started looking at houses to find one to possibly purchase about a year ago. However, NOTHING has become available in that area in the past year. This is strange but given the current uncertain times and the slow economy, it is not surprising since people are reluctant to sell. You have inherited your grandmother’s house in California which is worth $1.8M! You have been renting it out, but you want to sell it and buy your dream house in SOHO. With your new salary of $150K and having a house of your own; life will be great in NYC! As luck has it, a friend of yours tells you about her friend who lives in SOHO and wants to move to New Jersey! Their house has not been listed yet and they prefer to do a private sale without any agents. Your friend has asked you to think about how much you would want to pay for this property. Given that there have not been many transactions in the last year in the area, and the continuously changing real estate market, you have NO idea what a fair market price would be. You have looked around and found out that the houses of the same size in the area have been sold for a range of $800K to $2.5M in the last five years. The range is too wide and it does not really help you! You are meeting the owner today.
Negotiation in Action