Mr. Seller - The Market Doesn't Care What You Need

Dear Mr. Seller,

Congratulations on your marriage on New Year's Day last year and the twins that are coming in December.  I am very happy for your growing family, and I am sure that you are looking moving to that beautiful home that you sent me from Realtor.com. Your dream home comes with a tablespace kitchen, a big yard, and a family room off the kitchen! It also comes with a $750,000 price tag. 

I know that you paid $300,000 with 5% down for your 650 square foot one bedroom condo three years ago.  I understand that you need your condo to sell for at least $450,000 so that you can realize the $75000 that you need for a 10% down payment on your new home, and then cover closing costs on both transactions - the sale of your old home and the purchase of your new one. Don't you think that this is asking a lot of one little condo? Particularly when the most recent sale in your building is the unit on the top floor in your tier that just sold for $299,000?

Unfortunately, the market doesn't care what you need to realize in the sale of your condo.  The offers that you receive on your condo will be based on impersonal factors such as comparable sales, current inventory, available financing and on a few factors that you can affect, such as the condition of your condo.  You see, even if your future buyer thought that money was no object and wanted to give you what you need to buy your dream home, that buyer is probably getting a loan and will have to get an appraisal as part of that mortgage.  It is unlikely that the appraiser is going to be as generous as your dream buyer.  The appraiser is not going to let the buyer give you what you need to move to your dream home, just because you are so nice and you and your spouse are expecting twins.

So what do you do?  The choice is yours. You can stay put. Living in a 650 square foot condo with a spouse and newborn twins can be challenging, but babies don't take up a lot of space, and you certainly will enjoy that quality time and togetherness. Some people find it challenging to always keep a house in a ready to show state, but at $450,000, you may not get many showings anyway.

Another option is to scale back on your new home.  Maybe we can find a dream home a little further from city center but still in a great neighborhood with a big yard and wonderful schools. Or we can look for a diamond in the rough that is undervalued because it needs a paint job and a little imagination - the plain Jane overlooked by everyone else.

The most important decision you have to make is price. Remember that the market doesn't care what you need and will only give you what your home is worth. If you want to sell your home, you need to be realistic. Price your home in harmony with the rest of the market.  No one is going to give you more than what your home is worth. The buyer can't care what you need.

Kindly,

Lise Howe

Associate Broker, Coldwell Banker Residential Brokerage

Washington, D.C.

240-401-5577 or 202-362-5800