This Week's Question

October 9, 2004

By Nena Groskind

Q:  Recently, a friend read an ad in the real estate section describing two condominiums priced at “$309,000 - $358,876. My friend submitted an offer of $309,000, which the developer rejected immediately. When I pointed out that this was the advertised price, the broker explained that it wasn’t a set price but a “value range,” intended to encourage prospective buyers to attend the open houses and bid on the properties. So that I can read real estate ads more knowledgeably in the future, could you explain exactly what a “value range” means? Is it legal to advertise a price and not accept an offer that matches it?

A:  Value range simply refers to the range between the lowest price the seller will consider (in this case, $309,000) and the price at which he/she expects (or hopes) the property will sell. There is nothing illegal about this practice; if there were, most of the people responsible for real estate ads would be in jail today. The developer was not required to accept your offer, although it fell within his advertised range; nor would he be obliged to accept an offer at the top of that range, even though the ad seems to imply a willingness to do so. Real estate ads, you may have noticed, do not always mean exactly what they say.