The Purpose of a Price Reduction/Adjustment is To.....

By
Real Estate Agent with Keller Williams 414-525-0563 57026-90 Broker
http://actvra.in/57rs

   As your eyes wander through the listings on MLS and you spot the NEW PRICE  label that accompanies some of them....and click on the "history" button to see what the 
New Improved...now motivated price is over what the past price was for the listing.....you sometimes learn that the Seller Price reducedis driving...or more appropriately, dragging the price...the reduction was $5,000 or less than the previous price that the market rejected.

    Regardless of the price the Seller(s) want...need....must have....the market decides.   The comparables aren't what a they want them to be...what an appraiser may have said months ago...the market decides TODAY what the price is....

      The longer that a house stays on the market at a price that has been rejected...no showings...few showings...no offer....the lower the price will be when the property new pricesells...No Seller wants to hear that...but that is the reality of the real estate market...and the market and the Seller don't always agree.   Sellers are convinced it's just that the "right" Buyer hasn't seen the property...likely that may not happen at that price point.

    Trust an experienced and successful Real Estate agent to guide the pricing structure....agents work on commBinocularsission...and agents who have a reputation that price houses to sell....and reduce them to a NEW LEVEL when they don't ....are the agents that are successful.

        The purpose of a price reduction is to atract a different group of buyers....you won't find them in the same $1-$5,000 price reduction...those are the same people.

     Be an honest agent....explain that the market changes...that there are no crystal balls that determine the price to the penny that the market is willing to pay at any bewaregiven time.....and Sellers...BEWARE of any agent who makes claims to the contrary...it just isn't true.  If a lower price is suggested...it is not because the Agent has any incentive to make less money.

     If you or anyone you know is lookng for real estate agents in southeastern Wisconsin that will tell you the truth...monitor the market and not allow that listing to get stale...but to enjoy that Sellabration in a timely manner...Call the Hansons, we are honored to be at your service for all things real estate.

Posted by

Sally K. & David L. Hanson, ABR, CDPE, CSS, e-Pro,ILHM, REDS


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Rainmaker
494,749
Nathan Gesner
American West Realty & Management - Cody, WY
Broker / Property Manager

The price reduction has to be significant enough to present the home to a new group of buyers. Too small of a reduction and it won't change a thing.

Oct 03, 2017 05:22 AM #6
Rainmaker
2,375,063
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker

Good morning Sally and David. Sometimes changing conditions, beyond your control, require a pricing adjustment. Knowing when to do so is withiin your control. Enjoy your day!  

Oct 03, 2017 05:25 AM #7
Rainmaker
4,270,833
Roy Kelley
Realty Group Referrals - Gaithersburg, MD
Roy and Dolores Kelley Photographs

Thank you very much for sharing some of your successful business practices.

Oct 03, 2017 05:28 AM #8
Rainmaker
4,270,833
Roy Kelley
Realty Group Referrals - Gaithersburg, MD
Roy and Dolores Kelley Photographs

I checked to make sure I am following the members who have commented on this blog.

Oct 03, 2017 05:29 AM #9
Rainmaker
3,948,304
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
"Franklin MA Homes"

Good morning, Sally K. & David L. Hanson a new improved price must be just that.... improved.... staying within the same price range does not register as an improvement... make it meaningful and it will work....

Oct 03, 2017 05:36 AM #10
Rainmaker
1,730,147
Jay Markanich
Jay Markanich Real Estate Inspections, LLC - Bristow, VA
Home Inspector - servicing all Northern Virginia

Everything is only worth what someone is willing to pay.

Good to see you can post pictures!  I have not been able to post a photo or picture for over 2 weeks.  And AR hasn't answered my questions as to why...

Oct 03, 2017 07:42 AM #11
Rainmaker
2,779,850
Michael Jacobs
Coldwell Banker Residential Brokerage - Pasadena, CA
Los Angeles Pasadena Area Real Estate 818.516.4393

Hi Sally and David -- I'm sure we've all seen some crazy price reductions and scratched our heads in disbelief.     When there is a change make it significant enough to be noticed.  

Oct 03, 2017 10:24 AM #12
Ambassador
3,302,149
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Sally and David the first couple of weeks a house is no the market is so very import.  Yet many Sellers insist on the house being listed for higher than their Realtor is telling them it will sell for.  In the end it is a loss of time and money.

Oct 03, 2017 12:21 PM #13
Rainmaker
1,727,897
Brian England
Arizona Focus Realty - Gilbert, AZ
MBA, GRI, REALTOR® Real Estate in East Valley AZ

It cracks me up to see a listing that reduces in price by $1 each week, haha.  Just price it right and get it sold!

Oct 03, 2017 04:01 PM #14
Rainmaker
2,449,030
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of Manchester NH's Leading Agents

Just now a seller called to decrease the price after a month of telling them, it was a $500 reduction they wanted,  and i want to laugh and cry Sally K. & David L. Hanson 

Oct 03, 2017 04:17 PM #15
Ambassador
2,517,802
Paul S. Henderson, REALTOR®,CRS,
RE/MAX Professionals. - Tacoma, WA
Tacoma Washington Agent/Broker & Market Authority!

I want a seller to read this post Sally K. & David L. Hanson 

Oct 03, 2017 08:18 PM #16
Ambassador
2,228,603
Debe Maxwell, CRS
www.AtHomesCharlotte.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Oh my gosh, we see these all the time - in $100 increments, once a week, Hansons both!

Drives me nuts and the reason they do it is to move the property to the top of the searches - a price change does that. Most buyers just laugh right past that house...again!

Oct 04, 2017 06:51 AM #17
Rainmaker
1,107,969
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Today's Buyers are way more aware and educated than to fall for the re-triggering efforts of a small $100 (or similar) price change, Sally K. & David L. Hanson ... as so many have pointed out, the change must bring new sets of eyes to the home.  That's only done with meaningful, intelligent price drops.

I'm hoping Sellers read this and take your words to heart ...

Gene

Oct 04, 2017 12:37 PM #18
Rainmaker
1,367,177
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning Sally and David - getting through the emotions of the sellers is sometimes difficult.

Oct 05, 2017 03:51 AM #19
Rainmaker
287,908
John Wiley
Jones & Co. Realty - Fort Myers, FL
Lee County, FL Real Estate GRI, SRES,GREEN,PSA

Well said!! When I announce a price reduction I use the term: Price Improvement. A $500 reduction is not an improvement. 

Thanks for sharing, I hope many Sellers will read and understand.

Oct 05, 2017 04:17 AM #20
Rainer
208,332
Athina Boukas
Virginia Capital Realty - Richmond, VA
Certified Residential Specialist (CRS)

Small reductions just reiterate that the house is STILL overpriced because it is STILL on the market...and you are reminding the buyers of that fact.

Oct 05, 2017 05:48 AM #21
Rainmaker
210,325
Shirley Coomer
Keller Williams Realty Sonoran Living - Phoenix, AZ
Realtor, Keller Williams Realty, Phoenix Az

You are so right!  A change of price of a few dollars does not change the potential buyers.  If they were going to offer on a house, a few hundred dollars wouldn't encourage or deter them.  The reduction needs to be significant.

Oct 05, 2017 06:29 AM #22
Rainmaker
1,087,583
Paula McDonald
Magnolia Realty ~ Granbury - Granbury, TX
Magnolia Realty ~ Granbury, TX 936-203-0279

Such a true statement that the market decides.  And we all know how the market can change on a dime.  Great post.

Oct 05, 2017 05:18 PM #23
Rainmaker
1,891,041
Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents
Lyon Real Estate - Sacramento, CA
Put 40 years of experience to work for you

I saw a property in Sacramento the other day with at least 4 price reductions. The agent didn't even care enough to take the home off the market and put it back as a new listing. She just keep reducing the price. It's called "chasing the market down," and that home will eventually sell for far less than it would have if the price had been right in the first place.

I think agents who let their sellers chase the market down are just being vindictive.

Oct 06, 2017 01:09 PM #24
Rainmaker
839,903
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Spot on advice.  I really like your opinion on $1 -$5,000 price reductions.  Same buyers, same dance, too!

Oct 12, 2017 12:27 PM #25
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Rainmaker
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Sally K. & David L. Hanson

WI Realtors - Luxury - Divorce - Short Sale
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