The Longer the Shelf Life, The Less Chance You Have of Selling Your Home

By
Real Estate Agent with www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 228209
https://activerain.com/droplet/br4

The Longer the Shelf Life, The Less Chance You Have of Selling Your Home

"HELP!  We've received an offer on our home...and it's WAY too low!  What on earth are we to do?"  I know it stinks and it just plain doesn't 'feel' right either.  Many sellers have the initial reaction to just ignore the buyer, exclaiming, "That is not even worth a counteroffer!"  That's definitely not where you want to begin in the negotiation process.  Here are a few points to consider instead.

I once had a buyer who made an Offer of $700K on a property that the sellers thought was simply TOO low because they had, one year prior to that, received an appraisal value at $775K.  We knew that the price that we were offering was right  on the money but, they insisted that we were WAY too low and they would not respond to our Offer.  Fast forward a year and a half and their home is still on the market and fair market value is now down to the point that the absolute HIGHEST amount which they can get on their home is $600K.  Would have, should have, could have, right?

Home on the market for MONTHS!Sellers, keep in mind that your very first offer may not be exactly what you were dreaming of--but, you simply must consider this offer. Making a stiff or non-counteroffer is likely to have your first and quite possibly only buyers running for the hills!  How long are you willing to let your home languish on the market until the next, probably lower, offer comes in--if, indeed one does?  Bear in mind that a non-counteroffer was not what the buyer was expecting and they may be aware that they're bidding low and fully expecting you to counter back.  If you do not, they think you may be foolish and will move on to property choice #2. 

Sure, it's tempting to stand your ground and wait for that dream offer to come in but, consider the amount of time that your home  has been on the market.  If you're running into the 'months on the market' rather than 'days on the market' then you need to seriously consider that first offer.  Don't bury your head in the sand--you must understand the realities of the current market and how it is trending.  Ask your agent to perform a market absorption analysis for you; the details contained within can be eye opening for you and help you to realize that you should not be selling with emotions.  Rather, this is a business transaction.  This first offer is certainly worth serious consideration. 

Days on the market have an impact on the buyer in ways which you, as a seller, may not be aware:  the longer the shelf life, the fewer potential buyers are going to come through.  Shelf life erodes your homes market value just as much as your neighbors home which sold at a foreclosed amount does--especially in a buyer's market!  Buyers begin to wonder, "What is wrong with the house that has caused it not to sell?"   What factors are keeping it from selling?  Is it price or is there something underlying that others have discovered before us? 

Take a long, hard look at that first offer.   If you don't consider this offer, how long will it be before you are able to garner another offer?  How long are you willing to wait?  How much lower are prices going to go before you do get another offer?  How much more in mortgage, tax and insurance payments are you willing to pay before you finally Close on this home?  What is this waiting period going to ultimately cost YOU in the long run?

Don't allow greed to stand in your way of moving on with your life.  Remember, you're going to come out better when you purchase your new home--you'll then be the buyer in a buyer's market! 

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Re-Blogged 16 times:

Re-Blogged By Re-Blogged At
  1. Lenn Harley 05/26/2011 12:46 AM
  2. June Piper-Brandon 05/26/2011 12:49 AM
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  4. Rachel Rabinowitz 05/26/2011 12:57 AM
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  7. Ralph Janisch ABR CRS Broker 05/26/2011 01:38 AM
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  9. Lori Cain 05/26/2011 02:23 AM
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  11. MaryJane Sheppard 05/26/2011 04:58 AM
  12. Joy Daniels 05/26/2011 05:07 AM
  13. Barbara Martino-Sliva, Top Producer 05/26/2011 06:45 AM
  14. Lora "Leah" Stern 914-772-4528 05/28/2011 04:30 PM
  15. Gabe Sanders 05/31/2011 08:52 AM
  16. Michelle Gibson 07/06/2011 03:59 AM
Topic:
Home Selling
Location:
North Carolina Mecklenburg County Charlotte
Groups:
North Carolina Real Estate
The Lounge at Active Rain
Local Expert
Charlotte North Carolina Area
Tags:
seller advice
charlotte nc home seller tips

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Rainer
32,054
Tracy McPeek
Cottonwood, CA

I think we have all been there.  I had a buyer submit a low offer (19,500 less) and before we submitted, I asked her where would she be happy ending up.  My buyer said she would pay full price.  Well, the seller lost out because they were "offended" and didn't counter.  The buyer moved on and the seller's still have their house.  Seller's need to understand it is just business and the buyer isn't intentionally trying to "offend" them.  The buyer is just trying to get the best price possible and the sellers will do the exact same thing when the shoe is on the other foot. 

May 26, 2011 09:42 AM #58
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Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Debe, it's dangerous to have a word 'still' in 'home for sale'.

The meaning of  'still' is...standstill, no activity, no vibrations (no showings?) etc. Still leads to stale, like a stale bread on shelf! And shelf life is no good for any home.

May 26, 2011 09:50 AM #59
Rainmaker
159,261
Suzanne Gantner
Sky Realty, Central Texas Real Estate - Round Rock, TX
GRI, E-Pro, SRES, SRS, ABR

My broker says "the first offer is probably going to be the best offer."

May 26, 2011 11:41 AM #60
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Kathy Schowe
California Lifestyle Realty - La Quinta, CA
La Quinta, California 760-333-8886

Great post-- and yes ... I agree, sometimes the first is the best and deserves thorough consideration!  Kathy

May 26, 2011 12:28 PM #61
Rainmaker
287,572
Barb Van Stensel
Chicago, IL

Just got a "partial" price reduction on one of my listings and while not happy, the seller tells me that she would like to see more acitvity in the house.  I told her that if she could make her home more competitive, change its location, and price it where it will attract ... she would see more traffic.

I am a firm believer on the first offer is usually the best offer and work with it.

Love the sign.  I needed a laugh today and you gave it to me.  Thanks!

May 26, 2011 01:09 PM #62
Rainmaker
181,350
Randy Harden
Wieder Realty, Inc. - Pompano Beach, FL
www.RERandy.com

Debe, great graphic with the cobwebs and a great post indeed. Listings go stale like moldy bread past its expiration date. Eventually no one wants to buy it because they think its gone bad.

May 26, 2011 02:21 PM #63
Rainmaker
916,935
Larry Brewer - Benchmark Realty llc
Benchmark Realty LLc - Nashville, TN

Debe - It's funny how buyers want to negotiate fantastic deals with homes that have been on the market for 3 days. I have a lot of fun with that one.

May 26, 2011 03:02 PM #64
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Virginia Hepp - Mesquite NV REALTOR
ERA - Mesquite NV Homes For Sale - Mesquite, NV
Mesquite NV Homes and Neighborhoods - Search MLS

This post is a gem, Debe.  And going viral!

When I am out with buyers, one of the first questions about a home that they like is "how long has it been on the market?"

More than 6 weeks or so - the buyer usually says, 'hmmm...they are probably getting desperate.'

This reality is hard on our sellers - I think I may print this one out, too.

May 26, 2011 03:25 PM #65
Rainmaker
1,557,915
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

I've seen it time and time again . . . house will sit and sit.  I've presented offers that were FAIR, but not full list price.  Seller turned their nose up.  Months, and months later . . . it still sits.  The market turned, they had to lower their price BELOW what my client offered months and months previously.  Cut your nose to spite your face doesn't work well in real estate. 

May 26, 2011 04:11 PM #66
Rainmaker
413,927
Tni LeBlanc, Realtor®, J.D.
Mint Properties, Lic. #01871795 - Santa Maria, CA
Tenacious Tni (805) 878-9879

You are so right. Especially if the market trend overall is declining.  Do not ignore that offer at least counter it!  

I hear so many stories like this with sellers who wish they had taken that first offer!

May 26, 2011 05:38 PM #67
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Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

Words of wisdom, Debe.

A good priced home should get an offer soon, regardless of the market. Of course we know this but the sellers don't.

May 27, 2011 01:09 AM #68
Anonymous
Greg Dean

Nice blog, I've saved it as one of the better ones I've seen.  From time to time I show them to certain clients, this one I'm sure will be shown.  Houses do in fact 'age' and not gracefully, the longer they are on the shelf.  Some people just need to be educated and understand their position is not unique.

May 27, 2011 04:20 AM #69
Rainer
332,713
David O'Doherty
Raleigh Realty Inc - Clayton, NC
Clayton NC Homes, Raleigh, NC

Debe, it's gotta be priced right or it will languish forever.

May 27, 2011 08:43 AM #70
Rainmaker
70,528
Mary Schurr
Mary Schurr Realty - Charlotte, NC
Realtor - Charlotte NC

Debe, 

All so true. I try my best to always get sellers to respond with something. And, I do have my buyers making offers lower than the market value, even after I showed them the comps. They worry about prices continuing to fall, appraisal issues, and losing the due diligence fee that is new to our market this year. Then, I find myself urging the listing agent to get the sellers to respond to a low offer. Shelf life is a great term and comparison. As several have said...market value is what someone is willing to pay for the home. And, if no one is making an offer then the list price is certainly not close to the "market value". 

May 27, 2011 10:11 AM #71
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Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Debe - This is such an important concept for sellers to understand.  And, looking at the value last year, just doesn't help their view of things.  I agree that sellers need to seriously consider any and all offers especially if the shelf life is starting to "expire."

May 27, 2011 03:24 PM #72
Anonymous
Brian Park

I like your shelf life comparison. I have used a similar analogy in the past. The last time was with some sellers where the wife was very fashion oriented. I said "Mrs. Seller will you explain what happens to merchandise that stays on the store rack to long to your husband. She picked up on it immediately and said it ends up on the discount or bargain rack, or sometimes it is even donated to charity." I said "exactly and that is the same thing that happens to houses when they stay on the rack to long, now here are your choices if you want to avoid the bargain rack...." Sometimes you have to lead, not ask, not suggest, but lead.

May 28, 2011 04:55 AM #73
Rainmaker
502,928
Lora "Leah" Stern 914-772-4528
Coldwell Banker, 170 N Main Street, New City NY 10956 - New City, NY
Real Estate Salesperson

Debbie, so often that first offer is the best offer you're going to get and especially so in a decreasing market (which we're still not out of).  Love this explanation and is a must read for every seller. 

May 28, 2011 04:24 PM #74
Ambassador
3,105,276
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

You know, I'm not a huge fan of some of the relocation companies but, they are definitely onto something having the sellers obtain 3 independent appraisals and going with the average for pricing.  One is often not enough but, I believe that there is truth somewhere in the THREE!  

Thanks everyone for your comments--we all seem to be on the same page as far as entertaining that first offer...now to get some offers on some of our 'almost-out-of-date' homes here in Charlotte!  For us, if they're price right, they WILL sell!

May 28, 2011 07:31 PM #75
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Debe, I think we've all been in a situation similar to yours and quite honestly, that first offer ends up being the BEST offer they will get! Congrats on the well-deserved feature!

May 31, 2011 08:54 AM #76
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1,879,794
Hannah Williams
Re/Max Eastern inc. - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-953-8818

Debe..I always tell my sellers the first offer is usually always your best offer ..Rule of thumb..

Have a Great Day!

Hepfulhannah

Jul 06, 2011 04:05 AM #77
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