Real Estate Myths: A Continuing Series

38 Crown Lane sold for $5,000,000.

One of the more popular, enduring real estate myths is the idea that if a wealthy buyer really wants something, it doesn’t matter what the asking price is.  This is baloney, of course, and here are two examples to prove the point…

52 Pear Lane

38 Crown Lane

52 Pear Lane (off fabled "Field Point Circle") fetches $10,000,000.

Both of these properties border on, and were bought by, mega-wealthy owners.  In the case of 52 Pear Lane, the famously well-heeled Egyptian next-door neighbor had a standing offer on it for $10,000,000.  After the death of the elderly owner, the family decided to put the place on the open market instead of accepting the neighbor’s offer. First, it was put up for rent (asked $25K, got 15K), then, a year later, for sale at $16,500,000.

That was an impossible price, so there it sat for another year.  Eventually, they sold it for (surprise!) $10,000,000, to… the fellow next door with the standing offer! Note that he waited patiently, and never raised his offer.  That’s because $10M was already a “generous” offer. But wait, you say, he’s worth hundreds of millions! Why wouldn’t he just pay up?  What’s an extra five or six million to this guy?  The answer is, an “extra” five or six million apparently means quite a lot to him.

The second example is 38 Crown Lane, owned by a well-known New York Knickerbockers star, and situated right next door to a well-known hedge fund billionaire. Knicks guy has standing offer of $5,000,000 from hedge fund guy, but Knicks guy can’t resist putting the place on the market for $5,995,000.  Four months go by and finally, Knicks guy sells to….are you sitting down?….The hedge fund guy for $5,000,000!  But wait, you say, hedge fund chap has billions! What’s an extra $995,000 to him?? He probably threw that much into trick-or-treaters’ U.N.I.C.E.F. boxes!  Possibly true, but once again, a rich guy declined to “pay any price” for property he very much wanted to own.

Next in this series:  Asking Prices…. y’ever notice how, when someone’s selling, say, a Van Gogh, they don’t start at $200,000,000 and negotiate down; rather, they begin at a number like $10,000,000 and negotiate up. Could there be a lesson here for property sellers?

5 thoughts on “Real Estate Myths: A Continuing Series

  1. Yep, people I know with that kind of money would have done the same exact thing. They didnt get to their position in life by overpaying. Shrewdness is a way of life; a never ending game. Broadly speaking perhaps this is something that distinguishes the northeastern mega million/billionaire from say those hollywood types in CA with similar networth.

    Btw, I wonder what Stevie is going to do with his expanded pad on Crown Hill. I say dont stop now until you have enough for 18 holes (he only has a two hole course now).

    • Cos Cobber:
      If I’m not mistaken, this was the third adjoining property the (billionaire hedge fund operator) neighbor has bought. If he keeps this up, he will re-unite the old “Symms” estate and it’s 20-something acres. Sadly, still not enough for a decent 9-holer.

  2. 52 Pear Lane at zoning for approval to tear down an existing 7,111-square-foot home and replace it with a new 9,059-square-foot home on a 1.6-acre property at 52 Pear Lane.

    • Anonymous:
      Yes, I had heard that the [well-heeled, Egyptian-born] neighbor was planning to tear down what was once the carriage house of his estate, which is called “Round Island”. I wouldn’t be surprised if these new extreme and ridiculous flood-zone regulations actually forced him to tear down the nice old antique building.

      • Hmmm, built in 1908… one of the few remaining original structures in that area. Somehow I don’t think that will go down without a major outcry. Remember the McCutcheon house? A new replacement would look so out of place after 103 years. I’m calling the preservationists and making a big stink if that carriage house gets torn down.

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