- Cecilie Rohwedder, WSJ
The Homes Real-Estate Agents Buy for Themselves
When Michael Rankin went house-hunting in Washington’s Georgetown neighborhood, his 25-year career in the real-estate business gave him an edge. He bought a detached, 1903 home with off-street parking and a large backyard—all hard to find in that area—for $5 million. Another $2 million went toward renovating the 7,000-square-foot home, which went smoothly because he and his husband, Mark Green, had already restored and sold other historic homes and were versed in Georgetown’s preservation requirements. “We knew not to go in and ask for things that you couldn’t do in a historic neighborhood,” says Mr. Rankin, 52, principal and managing partner of TTR Sotheby’s International Realty. He estimates his professional experience saved the family 10 months of waiting and tinkering with the design proposal. As it was, the renovation, completed in the fall of 2015, took 14 months.
Agents buying their own homes rarely strike a bad deal: They are first to spot desirable properties, often before they are listed. They know local inventory and historic price swings. And they have a working knowledge of construction, plus connections to the best architects, builders and designers in town. Above all, real-estate agents know what looks good to other buyers and often benefit when it comes time to sell. Unlike doctors or lawyers, who should not treat or represent themselves, many real-estate professionals buy and sell their own homes. Under the code of ethics and standards of practice of the National Association of Realtors, they are required to disclose personal interest in a sale or purchase. Beyond that, there are few restrictions, and agents’ houses are often among the finest in the area.
Susie Johnson, an agent with Coldwell Banker Gundaker in the St. Louis metro area, kept close tabs on a listing in suburban Chesterfield, Mo., for nearly a year. She predicted a series of price reductions before pouncing after the slow, winter selling season: She and her husband, Art, bought the six-bedroom home in 2010 for $1.3 million, well below the initial asking price of $1.6 million. Ms. Johnson, 65, said she knew the Chesterfield real-estate market would gain in value because it had been recently zoned for retail development. “I knew at that time the area was going to be a hub,” she says, adding that she now lives less than a mile from a Whole Foods Market, a Starbucks and a waterfall with ducks that she visits with her grandchildren. Real-estate agents have an edge over regular home buyers, she feels, in “really reading the market, really knowing when the timing is good and when you can get more house for the money.”
Billy Rose, founder and president of The Agency, a boutique real-estate brokerage firm in Beverly Hills, Calif., likes his 1940 Streamline Moderne house so much that he practically bought it twice. He first purchased the distinctive 4,200-square-foot, five-bedroom home in the Westwood Hills in 2003 for $1.2 million because he loved its stately, white and glass architecture, light-filled rooms and lush backyard Mr. Rose renovated the house and raised his family there for about a decade, when his marriage fell apart. After another few years, in which his former wife lived in the home, Mr. Rose renovated again to sell the house, asking an agent from his firm to handle the $3.95 million listing. At the first open house last year, Mr. Rose joined the agent to get a feel for prospective buyers. Instead, he fell back in love with the property. He decided to keep it, refinance it to buy out his former wife and move back in. At that point, three prospective buyers had entered a bidding war that pushed the sales price to over $4 million.
In the end, Mr. Rose removed the listing but still had to pay his ex-wife the amount she would have received had they sold to the highest bidder and a commission to the agent for his time. He is now renovating for the third time, updating amenities while carefully preserving period features—in case he ever does sell. Knowing what sells guides real-estate professionals’ own design decisions. Darren Sukenik, an estate agent with Douglas Elliman in New York City, lives in a stylish 2,500-square-foot, three-bedroom West Village condo with his husband, Eric Rogen, and their four-year-old dog, Hamilton. Walls are white and floors are black, a timeless palette that Mr. Sukenik says sells better than vibrant or gender-specific colors. Walls are polished plaster because lower Manhattan home buyers dislike wallpaper, according to Mr. Sukenik.
“I practice what I preach,” says Mr. Sukenik, 46. “Any real estate I ever purchase, I purchase with an eye to resale.” Mr. Sukenik bought a condo in the building 12 years ago for $1.4 million and later combined it with an adjacent unit he bought in 2015 for $2.5 million. With both transactions and the renovation, he benefited from professional instinct and connections. Mr. Sukenik bought the first apartment preconstruction, predicting that the southern edge of the West Village--“fringy” at the time, he recalls—would become an upmarket area. He also felt his would be one of few full-service condominium buildings in the area, giving it a premium in the market. Beverly Hills, Calif.-based agent Pate Stevens knows so much about construction that he could question and overrule the contractor when building his weekend home last year. In December, Mr. Stevens, who sells luxury properties for Nourmand & Associates in Los Angeles, completed a 3,200-square-foot, Midcentury Modern home on a Country Club golf course in Palm Springs.
Mr. Stevens, a widowed father of two girls, 10-year-old Tyla and 8-year-old London, built the three-bedroom house to give the children a place to play outside and ride their bikes or Barbie golf carts. He loved the mountain views of the 14,000-square-foot lot and the floor plan by Horsham, Pa.-based home builder Toll Brothers. But after a rainstorm, when the pool did not drain and the spa stopped working, Mr. Stevens says he persuaded the contractor to install a release valve, rather than a submersible pump, which solved the problem. Mr. Stevens, 54, also corrected a design flaw in the overhang above his large back patio, diverting the drainage to the side of the house to prevent water from hitting and staining the deck. Helped by a background in interior design and two decades in real estate, Mr. Stevens asked for an itemized breakdown of building costs for the $1 million home. He negotiated prices of some items and found lower-priced alternatives for others, including the white-tiled wall around his fireplace.
*Credit to The Wall Street Journal for Text and Photo*