Split the difference in RSM

As we head past the Labor Day mark and head into fall, it will be interesting to see what happens to sales. Will the government incentives still be enough to lure even more buyers?

It's a common negotiating tactic to try and split the difference - particularly if it works to your advantage. Say you bid $100,000, but the seller comes back with $200,000. You were planning to pay $175,000, but you see an opening. So, you say: "Why don't we meet in the middle at $150,000." That sounds fair, so the seller agrees and you've got a deal.

Here's a property that's splitting the difference in another way ... when we compare the 1999 price to the 2004 price that is...

8 Freesia, RSM 92688
Asking price: $649,000

Beds:	4
Baths:	3
Sq. Ft.:	2,877
$/Sq. Ft.:	$226
Lot Size:	5,000 Sq. Ft.
Property Type:	Single Family Residence
Style:	Mediterranean
Stories:	2
View:	Hills
Year Built:	1999
Community:	Las Flores
County:	Orange
MLS#:	S576384
Source:	SoCalMLS
Status:	Active
On Redfin:	98 days

From listing: Fantastic Location on a beautiful CUL-DE-SAC. Upgrades include GRANITE COUNTERS, MAPLE CABINETS, AND A DOUBLE OVEN in the Kitchen, TRAVERTINE, IRON AND WOOD STAIRCASE, CUSTOM WINDOW COVERINGS, BUILT IN BBQ, CUSTOM SHUTTERS, CUSTOM ITALIAN TYPE TILE FLOORS, BUILT IN CABINETS IN THE GARAGE, CEILING FANS IN MOST OF THE ROOMS, LARGE WALK IN CLOSET IN THE MASTER, RETREAT/LOT AREA OUTSIDE THE MASTER, UP STAIRS LAUNDRY ROOM, PROPERTY BACKS THE NATURE PERSERVE.

They say nature "perserve." We think wilderness. This property came onto the market about three months ago asking $715,000. With no sale, it's now down a bit to the current asking price of $649,000.

What the heck did we mean when we said "split the difference"? Well, this property sold for $406,500 in October 1999. Just five years later, it sold for $835,000. Yes,it doubled in price in half a decade.

Now, the asking price is just about in between. Call it a 2002 and-a-half price in the $600,000 range. Will it go for the asking price in the middle? Only the lender knows for sure. Assuming it does, we're looking at a depreciation of 22% off the 2004 sales price, not including any transaction or other costs.