2 Ways to Kill the Sale of Your Home

By
Real Estate Broker/Owner with J. Philip Faranda (J. Philip R.E. LLC) Westchester County NY License # 49FA1074963

I can't speak for every agent, but if I were your broker and I advised you to lower your price it is because you need to reduce your price. Most of my clients see the light; I've given them the market data as well as our showing and feedback logs. Some sellers don't get it, and they are the ones who eventually go stale. What is sad is that a stale listing sells for less than it would have if the seller took my advice because the public sees the days on market and assumes there is something wrong with the place. I get 2 main answers from sellers who won't reduce. One is a rationalization, another is a lame alternative. Both ideas will kill the sale.

 

  1. "People can make an offer." This is an irrational thought costumed as a rationality. If you've been for sale for 90 days and had two showings, this is absurd. People don't make offers on a home they won't bother to see. If you've been for sale for 6 months and had 50 showings, what makes you think the 51st will be different? Buyers will not make an offer (or, in some cases, even see) a property that strikes them as overpriced. Moreover, the only people that will make an offer on an overpriced home are the type who would offer less than a fair-minded person who can't reconcile price and property.
  2. "I'll pay a bonus to the selling agent" or "I'll help with closing costs." This is offered instead of simply reducing the price. Look, if you are going to throw more money into the deal, take it off the price where everyone can see it! This is an invisible benefit. People that need help with closing costs will ask for it even if it isn't offered. Worse, you still have a price point problem.

Real Estate Price Points

Price is king. People search for homes in round numbers. If they place their ceiling at $475,000 and you are priced at $479,000 you are flying under the radar of perfectly good buyers. Moreover, NOWHERE on a public search site is there a field for a selling bonus for the agent or closing cost help for buyers. Nowhere. People group the best homes in their price category and pick the nicest ones to see

If you are priced at $509,000 and your agent is telling you you'll sell at 499, DO IT. Nobody will see or care about a bonus or closing cost help! You'll be putting the home in front of more eyeballs as well as a more receptive crowd. The best marketing is smart pricing. The worst marketing is specious incentives. Price points matter.



 

Comments (6)

Chip Jefferson
Gibbs Realty and Auction Company - Columbia, SC

I agree I see bonus and closing cost added in so many times and I skipped right over that home via price seach. Lower the price.

Nov 16, 2009 12:58 AM
Larry Gray
Real Estate Consultant - Lakeland, FL

You are so right "price is king".  There is so much on the market that is priced right why would a buyer was time making offers on over priced property.

Nov 16, 2009 02:13 AM
Lani Sussman
Max Broock Realtors - Birmingham, MI
MI. Specialist - Oakland County

EXACTLY! Many sellers just don't want to believe that their "great" house has lost so much value.  It is just losing more value the longer they sit on the market at the wrong price.

Nov 16, 2009 03:03 AM
Jill Schmidt
Aurora, CO

Yes - it's so true.  But, somehow all sellers seem to "know about" someone who tried it high and got it.  Just like all buyers know someone who got a 3% loan or "what about those houses for $500?". 

Nov 16, 2009 03:59 AM
Douglas Fischer
East Oahu Realty - Selling Honolulu, Hawaii Condos - Honolulu, HI

Yes!  I totally agree.  Not to mention, agents and buyers look at listings in price brackets.  If a house is worth $499k, it is a very poor choice to price at at $509k.

Nov 16, 2009 05:31 AM
Barb Van Stensel
Chicago, IL

No Game.  No Gimics.  Price is King.  Bottom.  I have seen these bonus' ignored.  What it boils down to is price.  No more games and incentives.  Get the property into shape, price it right, hire an agent who responds and is proactive and you'll be sold!

 

Nov 16, 2009 07:36 AM