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A FORMULA FOR DISASTER IN A FRAGILE MARKET PLACE:

Reblogger
Real Estate Agent with Solid Source Realty Georgia 282203

Even after two years of having declining prices, agents are still over pricing homes.  I just completed two CMA's in neighborhoods which showed the actives an average of  22% above the sold comparables.  Another words.... the agents have the homes priced at $450k and all of the solds were around $350k.  READ THIS BLOG BELOW AGENTS AND STOP OVERPRICING YOUR LISTINGS!

Original content by Paula Hathaway, REALTOR, LBA 30HA0800896

OVER PRICING HOMES = HIGH INVENTORY + LESS SALES + DESPERATE SELLERS = CONTINUED HOUSING CRISIS: A FORMULA FOR DISASTER IN A FRAGILE MARKET PLACE!!!  

We MUST do in-depth research before we price properties!!! ....and we MUST price properties as if our lives depend on it.(...because they do!) If we don't face over-pricing head on, we will see the inventory levels climb like never before! Not only that, the desperation seen and felt by huge numbers of sellers that we witnessed during the downturn in 2008 will likely re-appear! In many markets there are still great numbers of desperate sellers.

DO THE RESEARCH!

    OVER-PRICED HOMES = HIGH INVENTORY +  MORE DAYS ON MARKET + LESS SALES + DESPERATE SELLERS = CONTINUED HOUSING CRISIS.

In my last blog post, I mention the above formula to the umpteenth agent who said he would take an over-priced listing but would schedule a reduction in the agreement in 30 days or 60 days. There are still huge numbers of real estate professionals who do not understand the importance of correct pricing---and we direct the whole real estate market; or at least we are supposed to!

In my last blog post "HOW DO YOU HANDLE A SELLER WHO WANTS YOU TO OVER-PRICE THEIR HOME ?..." I was amazed at how many agents feel it is ok to over-price a listing "for a short time like 30 days" ...let me remind you all that the best time to sell a listing is in the first 2-3 weeks on the market! Over-price it and you miss the best selling time!!!

Even a small amount over the correct price of a home will keep it on the market for too long! We can not afford this in this housing climate; people are desperate now (and more will get there)....but there are buyers out there and they are looking for bargains, even here, where the average income usually very high.

As a community of professionals who are looked to, by most homeowners, for our guidance and expertise, we MUST not over price homes. We need to take a stand NOW before we slip again into the abyss.

This may seem evangelistic to a lot of you but it is the basic truth: If we all take one listing with even a small of amount of over-market pricing, look at the impact! Guess who is in charge here?...We are and we MUST do what we can do to bring the housing market back to some normalcy.

 PLEASE TRY TO UNDERSTAND THE URGENCY AND IMPORTANCE OF THIS! DO NOT OVERPRICE HOMES IN THIS MARKET OR WE WILL NEVER GET OUT OF THE CRISIS!!!

Paula I. Hathaway, LBA, Prudential Douglas Elliman

Top Producer, Diamond , Gold and Chairman's Circle Awards

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Comments (2)

Diane Osowiecki
Diane O and Friends - Benchmark Realty - Franklin, TN
Greater Nashville Real Estate

The key to your blog....pricing the property at the sold price.  In the old days we priced at the active price.  Some old dogs and those young dogs learning from the old dogs haven't gotten the message.  They better or we will continue to have lots of homes with lots of days on market.

Feb 06, 2010 12:20 AM
Melissa Juarez
Massachusetts Buyers Broker Agency, LLC - Quincy, MA

Paula, rest assured I will be letting my buyer clients know ahead of time if I believe the house is overpriced.  Seller's agents also do not realize there are buyer agents out there who are well-informed and experienced and will not hesitate to point out that the property is overpriced.  Likewise, I always let my buyer clients know if the property is priced competitively and in some cases, if its a great deal!  The ultimate decision rests with the clients but at the same time thats why they hired me for! Thanks for a great post.

Feb 06, 2010 12:22 AM