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Buyers Waiting in the Weeds

By
Real Estate Agent with Keller Williams Realty Community Partners

I've been watching something the last 60 days that I've personally decided may be a trend here in Cumming, Forsyth County, Georgia.

I've noted several examples of this phenomenon, but I'll use one property as an example.  I listed this two-story, late 90's build home with a finished terrace level last September for $365,000.  The home is very well maintained, has a great back yard with both a sun deck and a screened porch.  The owner told me that they wanted to go ahead and get on the market, but really wasn't going to be motivated to sell until Spring 2011.  After a few showings, we reduced the price to $350,000 sometime in late 2010.  All through the listing period, the property received at least one showing a week, with a little lull during the Holidays. 

The only negative about this property is that it has a steep driveway up to the garage entrances, which I pointed out during the listing appointment and was confirmed from showing feedbacks.  After looking at our local market trends (prices still moving slowly downward), recent sales (very few) and the competition, I counseled my client to go ahead and drop the price to $340,000.  That goes against my personal philosophy of pricing homes at specific price points, such as at $350,000. 

(As an aside, buyers search from $325k - $350k or $350k to $400k.  A price at $340k would cause us to miss buyers starting their search at $350k.  That's why I try to price property at search points.)

So, I dropped the price on Sunday morning.  Since that time, I've had one showing each on Monday - Wednesday and two showings today (Thursday).  I'm fairly convinced, but with fingers crossed and a rabbits foot in my pockeet, that we will get this property under contract shortly.

So, what's the trend I mentioned at the beginning?  Buyers seem to be reticent to physically view a property until the price hits what they believe to be either fair or a sllight deal.  Otherwise, they are just flat skipping equity-seller properties and sticking with foreclosures and short sales (which represent about 50% of the sales in Forsyth County).  Is anyone else seeing this same kind of trend?

Susanne Brown
RE/MAX Realty 9 - Howell, NJ
I work hard to make real estate dreams come true!

Hi Michael!

I would have to agree that the buyers do seem to waiting until THEY see value.  Showings are few and far between when listings are priced too high. 

I make sure to tell potential sellers that this is not the time to experiment with pricing.  It is critical that we understand the market trends and convey them to our clients.  If priced too high to start, the seller will be chasing the market and will more than likely leave money on the table. 

A very costly mistake!

Apr 21, 2011 06:42 AM
Anonymous
zafrir Ben Zeev

Good luck
If so, is there a trend of buying in the area?
 Real estate investor have reason to be in the region?
Thanks

Apr 26, 2011 11:39 PM
#2
Michael Hickman
Keller Williams Realty Community Partners - Cumming, GA
@Zafrir, Yes we have a steady number of buyers here in Forsyth County. We also have investors in the area but not so much to flip but to buy and rent. We are still in a buyer's market in the $300k+ price ranges with inventories ranging from 10 to 76 months.
Apr 27, 2011 12:25 AM