Neighbors flipping townhouse - does this make any sense?

Post date: 2020-02-12 07:55:17
Views: 259
Our longtime neighbors recently sold their townhome, allegedly to a family member. The alleged family member has immediately turned around and offered the house for sale at a higher price - but I can't see how their numbers make any sense. What's going on here?

Madame Naberius and I have a townhouse, and we're thinking of moving in the vaguely defined future, so we watch the movement of the other townhouses in our little cluster to see what we might be able to get for ours.

Last November, our immediate neighbors told us they were moving out of state. They said they'd sold privately to a family member and would be out by the end of the year. According to Zillow, the house was sold for $660,000. This was good news to us as we are right next door, in an identical house, with the same woods behind us and everything. It's a perfect comparable and that's a strong price for our neighborhood.

So neighbors finished moving out around New Year's. Nobody moved in, and within a week or two the place was back on the market. Asking price $699,500. Unlike last time, there's now a sign out front, open houses, all that. A realtor is putting in some work to resell the place. And that's what confuses me. I'm no realtor, but my understanding is that the realtors' commission, split between seller's and buyer's agents and paid by the seller is six percent.

I get flipping a house (though I thought typically you did some improvements to justify the higher price), but if the current owner really did pay $660,000 and really gets $699,500 for the place, won't they actually be losing money by the time they pay that 6 percent?

What's a likely explanation for what's going on here and what the new owner is thinking?
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