I started reviewing comps for a townhouse listing in Ashburn VA that I plan to list later this week. There is a good amount of recent activity in Ashburn Village for townhouses priced under $350,000.00 which this one will be. So it was easy to pull up 11 listings of similar townhouses in the MLS that are Active, Under Contract, or Sold in last 120 days. At first sellers wanted to press the market value upwards by slightly overpricing. But after I Compared and Analyzed the Current Market, and suggested they stay with what is actually selling, he agreed that being priced competitively with current market was the better strategy. The units priced to compete were going under contract in less than 30 days, and the others that looked overpriced have been accunlating DOM of 58 days and 196 days. Sometimes I wonder if sellers add up the costs of 6 months of mortgage payments, taxes, electric bills, Insurance, HOA fees, etc. Just for a ballpark, let's say their mortgage is $1800.00 monthly =$12,800.00, HOA in Ashburn Village is $121.00 monthly = $726.00, Electric let's say $100.00 mo = $600.00, Taxes for 6 months = $1700.00 which adds up to $15,800.00 sellers spent staying in their current house,when they could have reduced their list price $15,000.00 at the start, and they might have sold in 30 days and already been in their new place. It doesn't always work like that, but it's a consideration for sellers. Being competitive in the current market is better than overpricing with the thinking that " buyers can make an offer", or "we wanted to leave room to negotiate". Here's what I hear over and over from buyers when I'm showing. " Why is that one $25,000.00 more than the others"?, " I doubt if they come down, it's only been on market 2-3 weeks", "It might not appraise, so I don't want to waste my time making an offer and putting it under contract, then have contract fall apart if appraisal comes in too low". PRICE isn't always the problem for unusally long Days On Market. CONDITION is also a huge factor. Buyers in the $300,000.00 range usually don't have a lot of cash reserves to do repairs after they buy. Then ACCESS ranks high on the list. Here are a couple things listed in Remarks in MLS that can lead to long DOM. " Limited service listing. Deal w owners directly for showings,inquiries,offers, and everything else till closing.24 hour notice. Have owners confirm commission in writing when you submit offer is advisable....". Here's another in same community:" Call owner to set up time, owner must be home to show". Both of those conditions can cause reduced amount of showings. The first actually should say, confirm commission in writing before showing, but that's another topic.
So Sellers, if you want to sell in a timely manner, pay close attention to the CMA. Compare, Analyze, Compete. And that means Compete in the Current market. No one can predict what the market will do. It fluctuates daily, and so do mortgage qualifications.
Buyers and their agents are comparing and analyzing as well. When buyers analysis closely matches the sellers analysis, a " SOLD" sign will soon appear!
Jeff Pearl / Lic in VA
Remax Distinctive -McLean VA
703-727-4876
Homes / Land / Farms / Historic
Comments(3)