It’s hard to generalize in general, let alone generalize about the real estate market, which is inherently a unique, specific, and very local thing. What might fly in terms of property specifications in one part of town, may not fly in another part of town. Why this is has to do with one thing: individual psychology. It’s almost as random and predictable as high school student politics in between classes in the hall. But for those that have the taste for this sort of work, for this vocation, then there are tremendous rewards. One way people are making this ever problematic market work out is through the pursuit of the short sale commercial properties may need. When you sell something short, what you do is you agree to return a piece of property to somebody or some company (usually a bank), at some specific time. People are most familiar with short selling within context of financial instruments, and really, in the real estate context, shorting really isn’t that much different. In fact, there’s a financial document at the center of it: the commercial short sale contract.
See, what happens is that banks will want to hold onto properties, instead of getting into a commercial loan workout discussion with folks. They don’t want to devalue properties that are on their books. So what they do is they have the property open to short selling. A broker goes into a bank, tells the broker that he has a seller; the broker sells the property at a high price, then buys back when the market continues to tank at a lower price, then returns the property.
