Most Common Reasons It's Time to Reduce Your House Price
How is your house sale going? If your home is not selling as quickly as you thought that it should, there could be good reasons for that. But, how do you know if you are having a problem, and should reduce the price of your home?
Think about what kind of feedback you are getting from viewings. Is something going wrong with the marketing strategy, or is your home overpriced? Often we value our homes more than others might - an emotional connection often comes into play.
You should not rush into reducing the price of your house before consulting with your real estate agent. Discuss your concerns to find out if he or she has any particular pricing issues at the current time.
Quite often overpricing occurs because the seller either uses human emotion or something silly like a Zillow estimate of value to determine what their home is worth. The article at Maximum Real Estate Exposure explains why Zillow estimates are not likely anywhere close to the value of your home.
If the price is validated by an inexperienced real estate agent, the problems will begin. Below are some of the most important signs that your home may, in fact, be priced too high.
Signs Your Home is Overpriced?
This is the twenty thousand dollar question. Take a look around the area and find out what price other homes have sold for recently. Selling a home is a little bit like listing something on eBay - the price may not be right the first time around.
Your real estate agent should have presented an analysis of value for you when they listed the house, but maybe it has changed. Real Estate markets can and will move around. Do your own research but also have your agent update their data for you. See if different properties have sold, gone under contract or are current competition. Remember the data never lies - people do.
Not Getting Enough Lookers
If you are not getting enough lookers, you may have a problem with the marketing plan. Discuss this with your real estate agent. It could be a good idea to have a look at your real estate agent's marketing strategy.
If your real estate agent is counting on open houses to sell your property, it may be time to find someone new. Open houses benefit real estate agents, not sellers. Real buyers schedule showings. If the open house is the focus, you probably have the wrong traffic walking through your property.
How Long Has Your Home Been On the Market?
The average home is probably on the market for about 21 - 30 days in a strong seller's market. If your home has been on the market for more than 45 days, it could be that any potential buyers have lost interest.
Ask your agent to go back to with them with a "special offer." In other words, drop the price and see if you can generate some more interest. Keep in mind that one of the first questions every buyer asks their real estate broker is "how long has the home been on the market."
If the real estate market favors buyers, find out from your agent the average time on the market. If you are already over the average, it may be time to think about a price reduction.
Home Upgrades Needed
Does your home need upgrading in some way? Home upgrades are not cheap, and if you can't afford to pay for them, you need to be honest with yourself and say that you can't afford to. This is another valid reason for dropping the price of your home.
Try to estimate how much it would cost to get the required home improvements that help get a sale done, and drop the price accordingly. Tell any lookers about the work that needs to be completed, and explain that you have lowered the price to accommodate for the repairs in their budget.
Too Many Properties on The Market
Are there a lot of homes of a similar standard on the market in the area? If you are all trying to sell your home around the same price, you will need to take some kind of action to make yours stand out. Sure, you may have a hot tub in your back yard, but is that what buyers really want?
When there has been a change in the market prices, you should take a look around and find out what is going on. Dropping the price of your home is a good idea when others are doing the same. You may not have to take a massive hit on the price. As they say, every little bit helps and it could be that a small amount of money will swing the balance in your favor.
Selling a home is about being creative. There are times when you merely have to be creative with the price. If you have been forced to drop your price, maybe you should try to negotiate a lower price on the property that you are purchasing.
Most of the time, you can find a way around the price drop.
Are Your Pressed for Time?
Do you need to get out of your home quickly? It is not at all uncommon for a home seller to need to move within a certain amount of time. Perhaps you have a job waiting for you in another state. When you need to move quickly, it would be a good idea to consider lowering the price. Remember that you have a valid reason for doing so. There is nothing wrong with your home; you simply need to move on with your life.
Do any of the above things line up with what you have been experiencing with your sale? If so it may be time for a reduction and move on with your life.