For the last few months, we have been chasing a deal in a neighborhood we know well.
The owner finally gathered offers from a bunch of potential buyers, including us.
As usual for us, we gave our bottom line number and a commitment that we would not chip price. The broker knew us and, as far as I know, vouched for us.
The owner accepted a different offer for a slightly higher price from someone else. Then, after his inspections, that buyer (i) tried to chip price by a material amount, and (ii) announced he needed much more time to close.
We’ll see if the owner accepts the price chip or kicks the original buyer out in favor of someone else.
This is the danger inherent in our no price-chip model… someone can come in, over bid us, then try to grind the owner down below our number.
It’s obviously painful to lose a deal like this. But, we feel strongly that, over the long term, our commitment to actually close at the price we offer will result in us getting to do more deals (plus, doing the right thing feels good).