Pricing your home in a Down Market

Pricing your home in a down market

Stats don’t lie. When the housing market has taken a turn for the worst in some markets, it isn’t the end of the day. But be aware that when you sell your home be realistic in pricing your home. Be Aware of the statistics around you. Be aware of the market trends and the economic impact that is happening in your area.
Too many time agents will walk into a sellers home and give them the dog and pony show about how they can sell this and sell that, how they can market the home and attract other agents into the home, do an agent luncheon (which really only helps feed the starving agents out there) and occasionally do an open house or two on Sundays. This actually is not a bad approach. In most cases the firm that agent is associated with is good, maybe the market leader and has the largest market share, and spends the most money on advertising for their agents. That is a good thing. Now we get to the truth of the matter.
Sellers don’t care. All they care about is what agent comes in with the HIGHEST price they can list for. Remember that is only the LIST price not the SOLD price. In our business we call that buying a listing. Psychology tells us that we always gravitate to things that we can either get on sale or sell at the highest price. CAUTION. The list price is not the SOLD price.
Listen to your REALTOR. First ask if that agent is really a REALTOR. Not every agent. There is a difference but I will leave that for another post.
Listen to the market and the trends out there. In the Richmond, VA area home are selling. Here is the breakdown.
< $300,000 5% drop in units sold from 2008 to 2009 not too bad
$400,000 38% drop in units sold from 2008 to 2009 that is not good
>$500,000 44% drop in units sold from 2008 to 2009 That is the Pits.
So when you have a house that is above $500,000 and above you better not over price your home to sell. Be competitive and smart. Taking the agent that gives you the highest list price doesn’t mean a lot when that house is on the market for a long time and several price drops. If you are relocating don’t try to make up for all the improvements you did when you know that price is way too much already. Be realistic and smart about it and go with the agent that has the best tools, the best information, supports that with real time stats and trends, and is being upfront and honest with what a realistic listing price should be. More so what the house will actually sell for in a reasonable amount of time.

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