The Chestler Jacobs Team on the Keys to Winning a Bidding War (and When to Bow Out)

With more than $750 million in closed deals in New York City alone to their credit, the Chestler Jacobs Team – comprised of Jessica Chestler and Ben Jacobs – knows a thing or two about getting a real estate deal over the finish line. Elliman Insider caught up with Jessica and Ben to delve a bit more into their background as a team and find out their keys to winning a bidding war, and, perhaps more importantly, when to know to bow out. Elliman Insider: How did you both get your start in real estate? Jessica Chestler:   I went to school for something very different, I went for sports broadcasting. When I got my first job offer, I freaked out about it. I realized it was not for me. At the time, I was helping my parents find a place in the Hamptons and the listing broker said something along the lines of “For how long have you been in real estate?” and it got my mind going. I decided to take the test, I was 21, and that was it. As a kid, I always was interested in real estate, my parents took me to open houses, I always loved real estate, I just didn’t think of it as a full-time career. “As a kid, I always was interested in real estate. I just didn’t think of it as a full-time career.” Ben Jacobs:  I come from a real estate background; my family has been buying real estate in Vermont for almost 45 years. My brother runs that business now. It’s totally different from our current business, it’s not brokerage it’s landlordship, commercial residential leases but real estate was always been a topic at the kitchen table so naturally it’s always been a topic of interest for me. After I graduated from Skidmore College, in Saratoga Springs NY, I decided to go to New York City. I didn’t know what I wanted to do but I knew that I wanted to try to live in the city because it sounded exciting and all my friends from college were going there. A cousin of mine was working at Corcoran as a broker and she encouraged me to get my license. So, I decided to go to New York City, get my real estate license, and I interview  at Corcoran. I started out as a sub-agent for a broker who had been in the business for almost 20 years. We left Corcoran to work at Core and from there I went out on my own. EI: What made you decide to join forces? JC: We joked about it for a long time. We both worked at the same company, a boutique real estate firm. We didn’t work together there; we had always been friends. When we were both setting out to leave, we didn’t even plan on moving together. We were interviewing separately at different places at the time. Both of us wanted to take a break. When we came to Elliman, we realized it was the company we wanted to work at. We started working together to see how it went, that was the summer of 2019. We decided to launch our brand officially after realizing we could work well together in January of 2020 right before Covid. We got very lucky in a weird way that joining forces was kinda of a slow play thing. We had the opportunity during the pandemic to make sure we were really good partners and ultimately it brought us closer as a team. EI: How often are you seeing bidding wars in today’s market? BJ :  It depends on which neighborhood and what market we’re competing in. The New York City real estate market is such an enormous market that you can have practically zero activity in one neighborhood and fighting for inventory in another. We were incredibly busy in the Spring of 2021 because we were seeing multiple bidding wars particularly in Downtown Manhattan. It was an exciting to experience  because the Manhattan market had been relatively slow since the peaks of 20152016. If we’re referring to Brooklyn, that market is beyond out of control with prices higher than pre-Covid days. Every property we have secured for our buyers in Brooklyn over the last 14 months has been in a bidding war. I’m talking about neighborhoods as north as Greenpoint to as south as Carrol Gardens. I think the reason for that activity is  mostly due to the flight capital from Manhattan brought on by the pandemic. We’re seeing the same flight capital escaping to the Hamptons, Westchester, upstate NY, CT, VT, Miami, and so on. A lot of those Manhattan residents who never dreamed of moving to Brooklyn decided to re-consider. If you don’t want to live in Manhattan and you’re not ready for the suburbs, where do you go? Brooklyn. That market and inventory was incredibly squeezed and continues to be as demand and the overall NYC market rebounds. Are the bidding wars gonna continue in Manhattan? I think in the last few months, it’s leveled off. But it could potentially start up again… it really depends on what type of Fall selling season we’ll have. I think inventory across the board will continue to stay low which will be good for the overall market. EI: What are the keys to winning a real estate bidding war?    JC: Bidding wars are out of control right now. In our opinion, the most important key is being strategic and having very good relationships with listing brokers to get a transparent understanding of what their sellers are looking for. We’ve won bidding wars at a million dollars over the ask and even $1,000 over the ask… at the end of the day, it is about having a strong relationship with the seller’s agent. “At the end of the day, it is about having a strong relationship with the seller’s agent.” It can be very arbitrary. The big key is to really prepare our clients before we see apartments that we know will be desirable and maintain strong relationships with the brokerage  community so we can have a conversation to make sure we are not putting something forward that will be competitive. Simultaneously, we are very wary about making sure our clients are not over paying in a bidding war scenario. EI: What are the signs you should get out of a bidding war? BJ: Bidding wars can get very emotional and that is when you see the increased pricing become concerning. Our responsibility is to protect our clients at all cost and make sure they are not buying something that is just unreasonably overpriced. That said- emotions can run high and if the clients wants the property no matter what the cost, we will do everything in our ability to secure it. EI: How about a buyer writing a personal letter to sellers? Does that really work? JC:   Answer is yes and no. We think it’s very important to have a relationship with the seller’s broker so we can get to know where the emotions are. We had a client of ours that ended up buying an off-market townhouse that was on for a lot more than what they ended up buying it for. The reason we got it is in part because of a personal letter; this was a generational house that had a lot of family history and the seller really didn’t want to give it to someone who wasn’t going to respect the history and originals details of the house. The client of ours wrote a very lengthy letter with our help, which it explained every reasons why they felt the house overlapped with their family history. At the end of the day, price is always going to be the main motivator, but when people are on the fence, a letter can be very helpful. Clearly if it’s a pied-a-terre or a new development, there is not much emotion, and we don’t think it’s worth it. When you can tell there is emotion attached to the property, a letter can go a long way. Contact Jessica and Ben today for all your real estate needs.