When a home remains unsold in the market for an extended period, it’s time to go back and reevaluate things. If you have been getting a good number of buyers coming to look at the home, chances are the home is being reasonably marketed. Hopefully, you have gotten some feedback from those buyers that have seen your home. By the way, for those of you contemplating selling your home on your own, it’s much more difficult for FSBO sellers to get honest feedback from prospective buyers. If there are quick and practical changes you can make to the home to address issues raised by buyer feedback, then by all means make those changes. As a general rule of thumb, if you had 10 – 15 showings with no subsequent offer, chances are your home is overpriced. Determining the asking price for a home is not an exact science. There are many reasons why it’s not an exact science:
- No two homes are alike.
- Some pricing variables are subjective. For example, what’s a nice view worth?
- The real estate market is relatively inefficient compared to other markets like the stock market. Consequently, it’s not always immediately obvious where the market is.
- There’s also an emotional component on both the seller and buyer’s part that can influence prices. If someone falls in love with your home they are probably willing to pay top dollar.
For all of above reasons, and more, determining the proper asking price of a home boils down to an educated guess. The components of that educated guess should be (1) historical sale prices of similar homes in the neighborhood, (2) current market conditions and (3) the goals and objectives of the sellers. If you didn’t factor in these components, especially one and two, then your price may be nothing more than wishful thinking. Revisit your price in light of these variables and adjust as needed. On the other hand, if you were careful in the selection of your asking price and you have been getting traffic don’t fight the market. If 10 - 15 buyers have seen your home with no offer, then the market is telling you, quite loudly, that you need to lower your price.
Lots of sellers like to start out with a very ambitious price with the intention of lowering the price later on. This is OK if you can reasonably justify the price based on historical pricing and market conditions. But, keep in mind that days-on-market is a bad thing. Once a home sits on the market for an extended period it gets stigmatized. Buyers begin to ask “why hasn’t the home sold?" This is not a question you want buyers to ask about your home. Therefore, be sensitive to what the market is telling you and lower your price if you’re not seeing offers.
In summary, if you’re getting traffic and no offers, there’s a very good chance your home is overpriced. 10 - 15 showings with no offers is a good point to step back and reevaluate all aspects of the home sale. If everything checks out, then the market is telling you loud and clear that you need to reduce your price.
Ed Chaparro is a licensed New Jersey real estate agent with Prudential New Jersey Properties servicing Middlesex, Union and Somerset Counties.
Ed Chaparro has over twenty years of experience working with technology and putting it to use to help people and businesses. Ed Chaparro mixes traditional real estate marketing (MLS, signs, direct mail) with a very aggressive Internet marketing plan that maximizes the number of buyers reached.
For buyers, Ed Chaparro provides methods and communications that enable them to view their options in manner that is efficient, informative and free of any hard-sell tactics. This approach has garnered Ed Chaparro a great deal of buyer loyalty.
For more details and information please visit www.EdChaparro.com