Our neighborhood held their annual "no-holds-barred" bargainmania called the GreyHawk Rummage Sale. You know the drill. Find your junk. Tag your junk. Sell your junk. Get up at stupid-o-clock, start the IV drip of coffee, and hit the up button on your garage door to find a half dozen cars lurking curbside waiting for you to display your wares.
And then the negotiating that would put a hostile corporate takeover begins. Will you take 10 cents for this 25 cent item? Throw retail out the window; this is the land of resale and everything must go. As a seller, you hold on to the believe that your stuff is special and you price accordingly. By the end of the day you realize your garbage is just like everyone else's and it's buy one get one free. Or buy none, just take this lime green lamp off my hands. Ultimately, it's an economy of one thing: CASH.
We are living in a time of Garage Salonomics. Everything in Florida is being liquidated and the only form of payment that consistently works is green and made of this funny looking paper (I was going to come up with something a little wittier, but I didn't have any bills in my wallet to look at for ideas). Here's some garage sale principals that are playing themselves out right now:
1. A slap in the face pricing structure. Zillow did a survey a while back and something like 67% of homeowners in the country still felt their house was worth more than it was. That number is down close to 30% now. Price is 95% of what sells right now and if you can suck up your pride and be realistic with your numbers, you'll end up selling your goods.
2. He who has the cash fills up the back of the SUV with the prizes. If you've played the markets well and didn't follow the trends or do what was popular, then you're in an incredible position to create massive amounts of wealth. You can buy whatever you want at a deep discount whether that's used baby toys or real estate which in some cases is selling for clearance rack pricing.
3. No plastic please. Forget about liquidity and credit. No matter how much money we throw into the system, it's getting harder to borrow. If the ATM spits out money, take it. But otherwise, expect to pay in gold dubloons, yen, euros, or wampum.
4. Negotiate like Trump. Pretty sure I read in one of Trump's books that he uses a very simple negotiation technique that works at garage sales or land sales. He asks the question, "Is that the BEST you can do?" Keep asking it until the seller says YES! He's saved millions of dollars with those words and I've tried it myself and it works.
5. Think outside the driveway. During my garage sale, I was selling this mini-fridge for a friend, and a guy came up to me and really liked it. BUT, he had just bought a bigger one down the street. I said, "Well, why don't we just trade?" It really confused him and he thought about it for a while and eventually, he bit. I then turned around and sold the bigger one for five bucks more. The point? If you can think creatively, look for ways to get deals done, and just try it, sometimes it works. Barter if you don't have cash. Buy and then sell; take the profits and buy more.
There are probably a million more Garage Salonomic principles to cover, but it's past 2 PM and we're shutting the driveway operation down until next year. Feel free to chime in on your favorite insight and I'll see you at 6 AM parked outside your home soon! (OK, that sounded kind of creepy).
Mike Tullio is a Managing Partner at Blue Skye Lending and he's got a pocket full of quarters just waiting to be spent this weekend in a driveway near you.
Mike Tullio| Your Personal Mortgage Consultant for Life | 8130 Lakewood Main Street, Suite 205 |Lakewood Ranch, FL 34202 |Cell. 941-228-1020 | Fax. 866-415-7805 | email@example.com