Here’s a financial lesson for anyone who participates in online social media of any sort. It’s a cautionary tale about online privacy; not the stalker-type issues that most people are worried about; instead, it’s about how you have to be careful to reveal too much online about business dealings. I was catching up with some relatives who sold their house a couple of months ago, and they told me an amusing story that showed how they “made money” using Facebook…on their home sale.
My cousin Stan and his wife Elaine listed their house about six months ago. They had remodeled it and priced it to sell in a market that had been hit very hard by the collapse in real estate prices. Fortunately, they weren’t in any hurry to sell; the mortgage was paid off, they were already living in their new empty-nest retirement digs, and the old house had no association fees and only minimal costs (low property taxes, some minimal lighting and heat for the winter, etc.)
They finally received a good but not great offer, accompanied by the earnest money check. No issues came up, and the usual back and forth of the negotiating process went on. Stan and Elaine are older than I am but (like me, I guess) have stayed right on top of “the internets.” After they received the check – with the prospective buyers’ names and address on it – it took Elaine about 5 minutes to find the buyer on Facebook. She was simply curious whether they were serious buyers or not.
What did she find? Posts on their Facebook wall about how they had found their dream home. How they would pay anything to get it. Links to pictures – gushing comments from their friends and family. In short, drool splattered (electronically) all over Facebook. The buyers were even inviting all of their friends over for a big party the weekend after closing. Elaine found all of this – before the final price had even been agreed on!
As you can imagine, this gave Stan and Elaine (a) confidence that the sale would go through but also (b) a gargantuan advantage in the ongoing negotiations. Instead of being tentative and worrying about offending the (still potential) buyers, they were able to become far more resolute about refusing any concessions, changes in the contract or even agreeing to make changes based on (relatively minor) inspection issues. They didn’t become jerks about it, but they realized that they had an advantage over the buyers. That advantage translated into a financial gain when they were able to push back on every change not in their favor. Presumably the buyers never knew about Elaine’s visit to their Facebook page – maybe they assumed she was “too old” to be on Facebook – but more likely they simply never thought of Facebook being used that way. Maybe they just assumed Stan and Elaine were tough negotiators.
Of course, a similar situation can arise outside of social media – I once made the mistake of being a little bit too complimentary while viewing a home with owners present – Bubelah’s done it, too. But we knew they knew in that situation. Maybe someone more Facebook-savvy than me could tell me that there are ways of monitoring who views your wall/profile/whatever. I’m not sure I’d trust that, though, because a more tech-savvy person always lurks around the corner, who can hide themselves from that monitoring, and on and on ad infinitum.
Keep your mouth shut online while the deal is ongoing. I can’t think of any reason that blabbing about potential deals online can help you. From the other party finding out and being annoyed (prices being revealed, locations being outed) to simple financial loss, how can you benefit? I am not a social media junkie, but I keep a low-key presence on Twitter, Facebook and LinkedIn (as well as two forums, 48days.net and a blogging forum). I have learned from Stan and Elaine’s amusing recollections of their home sale that it never hurts to assume that every single person on the planet may be reading your posts/tweets/wall messages, no matter how unlikely you might think that could be, and even the most harmless comments can have effects you couldn’t predict.