The Money You "Lost" in Your Price Reduction Wasn't Real

Reblogger Jill Watts
Real Estate Agent with Realty Pro, Inc. #96851

This is an awesome "tongue in cheek" article about pricing your home to sell. Thanks to J. Phillip Farranda in New York for sharing this cute way to look at how the BEST homes are being chosen first and even are being fought over.

Blessings, Jill

Original content by J. Philip Faranda License # 49FA1074963

Westchester Real Estate MarketWith a median home price hovering near $700,000, even a modest price reduction on a Westchester County home can be tens of thousands of dollars. I have to approach a reduction with the diplomacy of a funeral director but be as convincing as a physician imploring his patient to quit smoking. 

No one could predict after the stimulus where prices would go, but it is clear that what few buyers we have are skimming the absolute cream off the top and leaving the rest. They even fight over the good stuff, creating an illusion of urgency in isolated precincts. Overall, sadly, median home price is an illusion; it is a metric of the value of those few, unique sought after homes that people watch even when they weren't on sale. They needed nothing. They were priced to the bone for their category. 

Money lost in a price reduction was never your money. It was an illusion. It didn't exist. I find myself, more and more, explaining to mournful sellers that the $25,000 that went down the drain when they went from $624,900 to $599,900 was a paramour that never loved them. She never cared, Johnny. The baby wasn't yours. She wanted to close the Copa and make sure you never worked in this town again. For God's sake man pull yourself together, it was all an illusion. 

You know, that sort of thing they cover day 2 in licensing class. Or not. 

In 2005, 852 single family homes sold in Westchester County with a median price of $732,000.

In 2010, 424 single family homes sold in Westchester County with a median price of $715,000. 428 people got nothing

The pool of able buyers has shrunken by an absurd amount. Millions of prospects have vanished due to either their own disasters or the new draconian lender underwriting guidelines. What few buyers remain are skeptical, drunk with options, terrified of making a mistake, have no confidence in the future, and are heavily invested in the group think notion that they must get a steal or they will be exposed to grave financial risk. You know, all those happy things perspective home buyers have always focused on. 

Here's the reality: If you are multiple listed, staged well, tidy, and have been on the market for 60 or 90 days with no offers or few lookers, the market has spoken; you need to reduce your price. You aren't the McClotchkees down at the end of the cul de sac who sold in the first 30 days. They had something, or ten things, you don't have. And the only adjustment you can make to the buying public is price. A feature ad won't do it. A newspaper display ad won't get it done. Busting your agent's chops to chase down Gladys Pflarphlingston for feedback on a showing 2 weeks ago won't do it. If you are on the MLS, I can show you how many people have clicked on you online and clicked off every week since we listed. You aren't a secret. Quite the opposite: with public searches, serious prospects can tell me their opinion of your toothpaste.  

If we are in showing condition with my marketing and you aren't sold, the faster we address price the faster we'll sell. The money you are asking for is not on deposit in the bank of buyer opinion.

 

Subscribe to J. Philip's Real Estate Blog by Email

Active Rain members-Feed your mind.  

Memorial Day 2011: Giving Back to a Veteran in Need

  • We Are Westchester County & Metro New York Real Estate. Reach Phil at (914) 723-8900.
  • J. Philip Faranda, Broker-owner, J. Philip Real Estate, LLC. Vice President, Empire Access Multiple Listing Service. 
  • I am one of New York's premier short sale REALTORS, serving Westchester, the Hudson Valley & Metropolitan New York.
  • Free MLS Search! Register for a Free Listingbook account and search the MLS like an agent. 
  • I am hiring agents. We offer outstanding support, marketing resources, and pasta. 
             

All content/images, unless noted, are the property of J. Philip Faranda & may not be used without permission
close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Ambassador
2,061,685
Michelle Carr Crowe,Altas Just Call...408-252-8900!
Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years

Well put. This is one of the hardes truths for sellers to swallow.

Jun 09, 2011 07:52 PM #1
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
375,841

Jill Watts

A Luxury Experience at Every Price Point!
Questions about Properties?? Ask Me!
*
*
*
*
Spam prevention