BOULDER NOTABLE SALE: 523 Arkansas Mountain Rd | $1.33M

We covered the top level overview of this sale in podcast #56. Let’s dive in a little deeper to help sellers understand the risks they face in this market. 

THE DEAL

• September 2022: Listed with agent #1 at $1.95M.

• A nearby home on the same road, about the same size with similar views sold for $2.13M earlier in the year. Likely the seller (and agent #1) were eyeing that sale price and thought it was a good comp. It wasn’t. Not even close. 906 Arkansas is several decades newer, better designed, and arguably more fire resistant. It also featured far superior views from inside and outside the house. The difference between mid 70’s and early 00’s design and construction quality is night and day.

• April 2023:  The listing is “refreshed” by creating a new MLS number. The price dropped by $100K to $1.85M. This doesn’t fool anyone who conducts even the most superficial due diligence, but arguably may encourage some potential buyers to take a look. If you’re going to take this approach, it’s a good idea to not just drop the price but utilize new photography.

• July 2023:  another new listing was created in another attempt to refresh the listing. The price was dropped to $1.75M.

• October 2023: the seller had enough and withdrew the listing from the market.
• March 2024: The listing agreement with agent #1 expires.
• April 2024: the seller hires agent #2 and the property returns to market. This agent priced the home much more aggressively at $1.65M and began a rapid and systematic price cutting plan. Agent #2 also helped convince the seller to remove a large number of trees from around the property, which dramatically increased the curb appeal and natural light inside the home (albeit at the cost of natural cooling). This time around, the photography was also much better and featured the beautiful lines of the home.
• August 2024: The property goes under contract.
• October 2024: The deal closes at $1.33M or 4.5% below the last asking price.

TAKE HOME LESSONS 

• Mountain homes are a unique segment of the real estate market. The rabbit hole for due diligence, specialized knowledge, and insight into the psychology of the mountain home buyer is not just different from town, it goes much deeper.
• People move to the mountains for the romantic imagined experience of living in Colorado. Proper preparation for listing might involve removing a lot of trees to increase the quality of the views. “The story” needs to reflect the reasons that a person might want to live in the mountains.
• Patience is often required when selling a mountain home. These properties can be on the market for many months, in some cases years, before “the right buyer” comes along. In the interim, it’s important to track competitors closely, solicit useful showing feedback from actual buyers, and be prepared to make changes.
• As I mentioned in our podcast, this home was originally owned by Joe Walsh of the Eagles. I don’t know if either the seller or the listing agents were aware of this fact. If they had, it should have been mentioned in the marketing materials.  “Rocky Mountain Way” was inspired by his time living in Boulder and recorded at Caribou Ranch.
• Agent #2 is a well known Boulder mountain home specialist. And while many agents have occasionally sold a mountain home, it would be challenging to find a listing agent with more experience. Note: I’d like to think of myself as a worthy and aggressive competitor, but he still beats me by at least a decade.

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