We see them in every market, the nicely kept homes in decent communities and wonder why that home has not sold. In many cases, if a home is not selling - it's generally because of price. It has to be good value for the money. But many Sellers price their home well - and it still doesn't sell. So, what's the formula for when to reduce the price of your home and by how much?
In my experience Sellers just want to get as much as reasonably possible for their properties. Many resist reducing the price of their homes in the hope that an offer will come in that they can negotiate with. It is difficult to get an offer when the Buyers feel the home is priced out of their range, and don’t come to view it. A major factor to getting a prospective Buyer in the door is a list price that they can work with. Sellers must remember that it is the Buyer who will assist them in determining the final value.
Its time to reconsider your price when …
Your home is the highest priced home in your neighborhood or there is a wide spread between your price and other comparable homes.
Your home has been on the market a short time with no showings. If you haven’t yet exceeded the most current days on the market don’t panic yet. Have there been changes in your area? Have the number of listings in your area increased ? Is it summer holidays ? Have economics in the region changed ? or it could be the market has shifted and it might be time to think about a more aggressive price.
Your home is priced low, getting showings, been on the market a little while and it's still not selling - look at your home from a Buyer point of view. Is it clean, presentable, easy to show, etc.? Do you need more flattering pics online – take some nice shots and provide them to your agent. If not, make any changes needed and sit tight - perhaps your home might just need a little more time to sell.
Don’t smoke or have pets in your house. What does that have to do with price? Smoke and pet odours are offensive and instantly noticed when someone enters your home. It costs money to eliminate the smells from a house and Buyers will avoid it.
Your home is listed at the top end of area comparables, have no showings, or agents who "preview" and subsequently list the house next door at a much lower price - it's definitely time to adjust your price.
You decide to reduce the price - make it drastic, make it noticeable. Often Sellers want to reduce their price by a couple thousand dollars thinking that will do it. A price reduction should be noticeable enough to get the attention of Buyers. It doesn't matter if they think you are desperate to sell - the objective is to get offers!
When contemplating a price reduction, take into consideration the cost of owning this property for another 3-6 months, the benefits of moving on and any mortgages and or debt. This will lead you to a realistic “get up and go” figure.
I know alot of good real estate sales people who have done their homework and will show your home regardless of the pricing. They feel they know it's current value for their buyers and it's all based on comparables, experience and sales figures. The savy purchasers have previewed dozens of homes on www.realtor.ca and will have made similar comparisons. Your sales person will be monitoring listings and sales regularly and as a seller, it will be important that you do the same from time to time. The goal is to sell your property.