Good Evening Everyone,
Tonight's post is addressed to the sellers out there who are frustrated because their homes are not selling. Well today I came up with the magic formula, take 20% off whatever you want or think your home is worth and that is the price a buyer will be willing to pay for it. Oh, I can hear the moans and groans and the delete buttons going already. But hear me out please.
I was looking at the possibility of listing a property for someone today. This individual had already told me where he wanted to price the property. I thought is sounded a little high but rather than just discourage him up front, I wanted to run the comps before we met. This individual honestly thought he was right where he should be at the price he wanted. Well, if we were in normal market with normal appreciation rates the price probably would have been good. But today that price was just about 20% higher than the comps showed the selling price would probably be. In today's marketplace there is no such thing as a normal market. Nothing relating to Real Estate is NORMAL anymore and whatever you think Real Estate ought to be just doesn't hold in today's market. The old rules of the game just don't apply anymore.
What I am saying here is that you really need to listen when your agent tells you what your home will sell for. We are not talking LIST PRICE here, we are talking SELLING PRICE! If your market is down 10% than that is where you need to be if you want your home to sell. If it is down 30%, that is where you need to be.
Today's buyers are making their offers based on research they have already done or that they ask their buyer's agent to do on their behalf. If they make you an offer, that is the offer, and that is the price they are willing to pay for the property. You have two choices, accept it or not. If you don't accept it than that buyer is probably going to move on down the road to their second choice and it could be months or in some cases years before you see another offer.
It is a tough market for sellers right now because buyers are scarce and they are very reluctant buyers too. They have heard all the reports, they don't know, any more than I do, what the market is going to do in the future. They simply will not overpay for a property. If they are getting a loan they can't even if they want to, because the appraisal will tell the story. Many a sale has gone sideways this year because the appraisal didn't support the agreed on price. Sellers didn't want to come down to the appraised value and buyers just can't or won't go up. Buyers are very cautious and they will only move on a property that is at or below the comps in the area.
One more little point that is a little off the track but that you need to know. Sales are taking a LONG TIME to close. There is no sense in pressuring your buyer to a 30 day closing because unless it is a cash sale, it isn't going to happen. Lenders are very slow to move on anything these days and they are underwriting loans, re-underwriting, and underwriting them again. They are questioning appraisals and asking for second appraisals and desk appraisals before they will give final approval on a loan. In today's market being smart and patient are the keys to a successful sale. I hope you found this post helpful.
