Entitlement Mentality and Real Estate Investing

[Matthew Gil]

We have a 3br house that we are selling in our market and we had a couple put an offer in on it. We have been going back and forth on the sales price, standard negotiation stuff. Now all of a sudden the couple is playing hardball and wants to pay WAY lower than their last offer. The reason? In the course of the past day or two they found out what we paid for the property and they feel it is NOT FAIR that we would be making so much money on the deal after only a year of holding the property.

The property was a REO when we bought it, so of course we bought it at a low price, but we also had to put some rehab (money) into it, while also paying property taxes, etc.

No mistake about, we will make a nice little profit. However, we also countered at a generous price. To the outsider, it looks as if it is a win-win deal. The buyers get a house they like at a price that is below market value and the sellers make some profit. But, now that is not good enough for this couple. They now think they we are being greedy and may not accept our latest counter-offer.

Here is my point, I am finding that buyers and tenants are getting more demanding while they are becoming less in quality. There is a toxin or virus floating around called “self-entitlement†and it seems to be spreading. So much so, that it makes me think we should reevaluate our business model. Because, I don’t see this attitude getting any better.

As investors do you see a change in the mentality of the end user landscape? If so, how do you deal with it?