I'm not giving my home away! Heard this lately? As a Real Estate professional and trainer I spend a lot of time studying my scripts. It seems home sellers have been studying their scripts as well except so far they have only learned one; "I'm not giving my home away."
This feeling is understandable considering the real estate market here in Palm Harbor, Florida has declined by 40 to 50% since 2006. With a few exceptions though, most of these people are the same sellers that made 15 to 20% per year gains on their homes from 02 to 05 and I don't remember one person complaining about the price their home would fetch in that market.
Real Estate seems to be the only market where we try to get more for something than it's worth. Imagine calling your stock broker and telling him to sell your stock in Microsoft for 20% above it's current value or what if the local BP station raised gas prices 50 cents per gallon above the local market because they had just installed brand new custom shelving in their store.
So what do we do when we run into one of these I'm not giving my home away types?
1. If they are buying, remind them they will get a great deal on their new home. If it's a move up purchase, it will be a net gain for them. Good News.
2. If you are still in a declining market, help them self discover that a property that is only a little overpriced today will be more overpriced 30 to 60 days from now and the last time I checked, it didn't matter if your bait was one inch above the water or three feet the result was still the same. NO Bites! :(
3. My personal favorite (not really) is when someone tells me they are going to wait until next year when the market improves. Hello, am I missing something here? thousands of homes in foreclosure and our market is improving? OK, draw a graph with me. Lets say the market goes down just 10% more and then stays flat for 3 to 5 years until all the foreclosures go away and them comes back at say 5% a year. That's 7 to 8 years just to get back where we are today not to mention the 15 plus to get back to 06 values. This is of course an opinion and an estimate. No one knows for sure.
4. For the motivated seller this is good news because if you have a nice home in a good location and you are willing to price it right which (again my oppinion) is 5 to 10% below your competition you can still sell for close to full price in a short period of time. Don't believe me, I have sold 70 homes so far this year for 97% of the asking price in an average of less than 60 days on the market
Now go ahead, I know what's next. "Sure you can John because You are giving the house away." tell that to my seller six months from now when their competition is still for sell and priced below what my seller sold for. One last thought; as a local Real Estate Professional, I don't determine market value no more than a doctor doesn't brake your arm. He / She just reads the X Ray and says "your arm is broken."