Pump & Dump to Riches

posted in: news & updates | 0

When someone is thirty-five minutes late in this business it means you’re getting stiffed. Respect… ya right! And they made the damn appointment!
You get used to the low expectations – People talk a lot of bull in today’s Real Estate World. Broker. Agent. Buyer. Seller. Builder. Plenty of hot air that’s for sure… that’s what happens when you make $500,000 in twenty months for simply signing a deed. Astute Investors… huh! “Rising tides lifts all boats”, as the saying goes – but it seems Danny Marcus is the only one who just keeps his mouth shut and just keeps moving carefully forward, asking little from The Gods of Rational Thinking. That’s why he put his house on the market last week for a number he thought was crazy. But what’s crazy today? International Players with full pockets don’t seem to think so, ‘Globalization’ they call it – it’s going to solve all our problems. Hell I even started to see this ‘Great Globalization’ thing over ten years ago… when both Government and Joe Public were completely in the dark. Now everyone is up in arms about being shut out of their own housing market. “It’s a bubble.” “We’re being invaded.” “Something must be done.”
It’s more than all of that; Danny’s story is common, way too common. It’s really way more than all of that; he’s been a long time friend, and an honest one at that. You could make a very good case that Government has turned a blind eye for way too long.

In 2009 Danny bought his house for $950,000, yes there were multiple offers, but the world was experiencing the ‘Great Recession’, so no one was venturing too much past the 899 list. His business Partner Jonathan Anand, who is also his Agent and his oldest friend, said there were three other offers – but who knows if that was true? “I think fifty grand will take it”, he said. They both looked at each other with a look of doubt.
Two hours later Danny’s dream home was his.
“Detached homes up 18%.”
Every year since it’s became the same of the same in big bold headlines.
“Neighborhoods in the City up plenty year over year.”
He bought the right house in the right neighborhood… and now he was a Multi-Millionaire. Who needed an MBA? This wasn’t about hard work, slugging it out building a business, this was about timing, or more accurately – luck. 9/11 had made America a much tougher place to tiptoe dirty money into… but not Canada, or England, or Australia; importing offshore riches was now big business. Globalization knew that all this money, from various economies with different laws and values, would be sloshing around the world… right? Danny’s Agent kept-on repeating so many incredible stories of blind excess happening throughout a fiercely growing market.
“Something is not right here.”
Permanently low interest rates were making it a gas fire.
“This is not going to end well.”
They looked at each other as if twenty years of experience meant nothing. Enforcement seemed non-existent, while a sophisticated network of ‘certain Accountants’ was now in real demand; Clients boasted as if they knew some big secret. Cranes littered the sky while floors were being sold to just one buyer. Monster homes were being erected to those same buyers’ kids – ‘Students’ it said on their visa forms. Students with deep pockets!

Fast forward to 2016 when Danny decided to list his house for $2,888,000; eights are lucky to those from the East, and his Neighborhood was now full of their affluence. The Wealth, good God, their economy must be humming along nicely everybody thought on quiet Alexandra Boulevard. Globalization meant that all that money was the same… right? Funny though, drive-by any night of the week and many of those homes were now dark, not a sound; Danny soon figured out that his neighborhood had become a parking lot for offshore riches. Were these neighbors Citizens? Visa holders? He did see two young millennials walking out of a house every morning at 8:30 with a backpack looking ready for school. Student visas? Ya right… nothing prepared Danny for this. Nothing.
It is absolutely way more than all of that, and it’s far too late.

Two weeks have passed since Danny’s listing went up; his Agent staged two open houses each weekend to display the $500,000 renovation… hardwood floors, marble tiles, custom mouldings, waterfall showers, a large granite island placed in the brightest cream kitchen anybody could ever dream off. Backyard landscaping that was to die for, if I do say so myself – I walked the house and it was perfect. English-speakers paraded through looking at every detail like it mattered. Russian-speakers did a little less. Farsi-speakers even less than that. Asian Buyers and their Agents moved around like they could have cared less… barely interested in the level of workmanship that took ten months to complete, and put plenty of grey hair on my friend’s head. You renovate. You know. Professionalism is sorely lacking in this industry, but that’s another story… a very long and frustrating story for another day. Danny did not want to believe his house was a tear-down!
Wait there’s more.
One night before offer day Danny’s Agent called him at exactly 6:49 pm – “One never forgets something like this”, he said later.
“I’m really sorry but I just can’t get away, my kid is sick and I can’t leave.”
“No problem, I got it.” Two Agents coming simultaneously from the same Brokerage firm did not strike Danny as odd. “Thanks… I really appreciate this.” “Should I stay home?”
“Absolutely, they didn’t give us 24 hours.”
Danny’s giant tv screen faced the driveway, so he knew he wasn’t going to be too put out.

In twenty minutes flat… barely twenty minutes actually… or more like incredibly… that driveway of Danny’s took on the look of a loading dock… four white vans… four non-descript white vans pulling up… and people… lots of people starting to walk out… herding up his driveway very quickly in fact… file folders in each hand… all with the same colored logo on it.
Ring. Ring.
“Hello?”
“I am Penny and this is Mary, we are here with our Clients to see the house.”
Danny counted seventeen focused buyers as if they were on some type of Real-Estate Tour.

The next day his house sold for $3,888,888.

share this: