It would almost be funny, if it weren't so sad. North Texas worked it's way out of a recession between Summer 2008 and Summer 2009. We've seen steady improvement in our housing market since then. But, I see some people in Prosper reducing the price of their homes and continuing to give away equity that they earned in their home. They blame the economy, but that isn't really the reason.
When I list a home in Prosper, Texas now, in 2010, I am brutally honest with my homeowners. You have to be, or you are just wasting everyone's time. If condition is the issue, I owe it to them to give them a to-do list before putting the sign in the yard. If amenities are the issue, then there may need to be a small investment in the house made in order to improve the marketability. If the home is over-furnished, we may have to have a stager come in and remove all but the key pieces needed to get the home sold. But, when pricing is the issue, I am not finding homeowners are inflating their values. I am finding that in Prosper, Texas, most of the homeowners I encounter have actually under-valued their homes.
When we establish a listing price for a home in Prosper, the owners want to know if I can really sell their home at or near the list price. My response is 'if you will let me'. I work VERY hard to establish the right price for a home based on what is going on in the market at the time the home is listed, and I monitor the pricing strategy every Monday, like clockwork, until the home is sold. The factors that create price - age, amenities, location, and condition - are applied to each home, as well as consideration for the competition in their local area. Local area has gotten much smaller in this market. Many appraisers will not look beyond the neighborhood for like-comparatives. And, the timeframe attached to their appraisal may be strictly held at the prior 90 days.
What I see happening in regard to pricing is that some sellers are so eager to make a deal work that they are sacrificing too much. You bought smart in Prosper prior to 2008. You got in on the ground floor. That is your money. Your buyer would not have been touring your home if they could not afford it. We agents go WAY out of our way to ensure our buyers can purchase a home that we take them through - especially in August when it's 112 heat index out there. These homes we tour better be spot-on matches to their criteria. To drag them around to dozens of homes at this time of year would be torture.
Reading a buyer is a big part of good real estate agent's job. This entails being able to predict an outcome based on their actions. EVERY buyer out there is going to start low. Ridiculously low. Lower than you can even imagine. Why? Because the one thing that went away with the recession was shame at delivering a low-ball offer. Why? Because of how common short sales and foreclosures became in 2008/2009.
In my last home sale negotiations, the buyer's agent did try to use the economy against us. And, they also tried to use the fact that the builder was in the neighborhood against us. Common tactics. No harm in trying. But, these are bogus issues at the moment. The builder didn't have any available specs at the moment in this buyer's price range (even though the agent told me they were considering new construction in this price range), and our economic situation in the Prosper, TX housing market has done nothing but rise all of 2010. Knowing the inventory makes a huge difference. It takes these issues off the table and lets us get down to brass tacks. It took the buyer a few days for the buyer to fully absorb the information that I shared with their agent about homes in Prosper, but they got the picture and executed a contract that is a mutual gain to both seller and buyer. Where we typically have to encourage restraint is with the sellers. It is difficult to stand firm when a buyer is threatening to pull out of an offer. I get that. All sellers want to get sold. But, a little faith in the marketing strategy and a few days of trust in a good real estate agent can put an additional $20k, $30k, or more in the seller's pocket. Let us do our job. Let us tackle bogus objections with facts. Let us compare one home to another on it's own merits and overcome objections. Let us work your sale price up. If we believe in the list price, and your showing traffic confirms that we've got it right, then don't try to force a fit with the first buyer who comes along. One truism in real estate is that "a home in demand stays in demand". This is a numbers game. Multiple showings equal multiple buyers. This isn't blind faith that the agents are asking for. It's faith in a formulaic and repeatable process that works. Keep in mind that even if you have never sold a home before, this isn't our first rodeo.
Prosper, TX is S-T-R-O-N-G! We are actually getting higher showing traffic right now than we did at the beginning of the Summer. Why is that? Because many of our buyers are from other areas, and it took quite a big piece of the Summer selling season for them to get sold on their last home. They are just now arriving in DFW and Prosper is high on their list of areas they'd consider purchasing. My best piece of advise to the homeowners of Prosper is to review the factors that established your pricing, review the marketing strategy, visit a few homes that are your closest competition, and then stand firm. Your market recovered. Don't give away your equity.
Have a blessed day!
Ronda
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