Price it Right and it Will Sell !
Today I removed my signs and lockbox from an expired listing that failed to sell during the twelve months that I had it listed and during the prior twelve months while another broker had it listed. Meanwhile about a month ago I listed a higher priced home and it sold within a week. What's the difference? Both were well maintained and both were in relatively desirable locations. Perhaps one had an advantage. The difference is that one was priced a little over market value to allow some negotiation (since you all think that negotiating is fun!) and one was priced (a lot over market value) at the amount that the sellers wanted to get for their home and had no relationship to market value. Guess which one sold.
(editors note - the home first mentioned above...two weeks later it's back on the market at the same price as the sellers work on their 3rd overpriced year on the market and yet another broker wastes marketing dollars!)
Life is too short to list over-priced homes and land. Over the last three weeks I've referred away or turned down three prospective listings with sellers who wanted to "just put it out there" at their price rather than market value. Two of the three are listed and overpriced. In one case, the listed home is priced more than 50% over the appraised value! The only good news is that I'm saving my marketing dollars for properties that actually have a chance of selling!
The current market situation of overpriced homes is further compounded by inexperienced REALTORS who haven't been around long enough to understand the cyclical nature of the market. Some of us enjoyed the good times and forgot what a normal market looks like. The most recent boom time began to pick up momentum in 1998 and with the exception of a dip in 2001 continued to rise through 2005. Economists watched as prices rose too quickly and outpaced the growth rate of salaries. The slowing of the market is part of a normal cycle. Similar cycles have taken place in history and will happen in the future too.
The current market for homes in the sub $1M range is attracting fewer buyers, yet sellers still want to price like it's the market of the mid decade (i.e. 2002-2005). It's time for sellers to understand that now more than ever you need a Realtor and you need to listen to your Realtor. The selling price is determined by the buyer, not the seller. Another way of looking at it is that the market will determine the selling price. In Warren County, the median selling price dropped a little more than 20% in the last twelve months,yet many sellers have not adjusted their prices or expectations. Given the increasing price of fuel oil and propane, I'm encouraging my sellers to reduce their prices before they have to heat and maintain an empty home for another winter.
As one associate says "Price them high, watch them die. Price them low, watch them go"
Real estate continues to be a good investment. The March 2001 median sales price in New York was $114,000-. Seven years later the March 2008 median sales price was $210,000-. Very good appreciation. It's still a great time to buy and as prices adjust to reasonable levels, good deals can be had.
Interested in buying or selling at a realistic, market driven, price? Give me a call or drop me a note. Got an overpriced home that you aren't really motivated to sell? Give me a call and I'll refer you to an office that will list at any price!