When the phone rings and someone says "We want to sell our house" most real estate agents who are eternal optimist by nature, think "CHA-CHING" pay check coming.
In today's market in my hometown, it may be more prudent to think "REALTOR BEWARE". How many of us ask the hard questions upfront like:
- Why do you want to sell?
- Where are you going and when do you need to be there?
- When did you buy?
- Do you have a second or third mortgage otherwise politely known as a "Home Equity Line"
- How soon do you need to sell?
By getting these questions answered upfront, as brash as that may be, you may really be setting the stage to determine if you have a listing that will sell or a "money pit" and emotional drainer.
What does this have to do with the old tried and true CMA? Well in my opinion, if you are in a declining market, the CMA is not worth much unless you figure in the rate of decline, just like the appraiser is doing. The comps you are using to determine a range of value may already too high, which means you price above the market from day one.
I'm of the opinion right know that every day a house sits on the market it goes down in value. If it is not priced below market and in excellent condition it will most likely not sell at least during your listing agreement. Sure we may get lucky, but as Dirty Harry once said 'Do you fell lucky, well do you" etc. etc.
If you know what the rate of decline is in the subject area and you apply those numbers, you may not "buy the listing" but you may find a seller that is realistic about the value of their home in toady's environment. If that happens you may get lucky and get a deal done.
When I got into real estate, "List to live" was the motto that I heard alot. Even today as listings pile up, but sales are few and far between the pressure to list is still there.
But another quote that I became fond of from more experienced agents was" I don't always want to be the first agent to list the house but I always want to be the second". I think you know why, the first agent was unsuccessful and spent a lot of time, money and energy and did not get it done or get paid.
Usually the second time the sellers are more realistic and motivated. They can also save "face" by giving the listing to a new, fresh agent, not because you can't get it done, they just don't want to admit that you were right and they should have lowered the price.
Some of the stats I've seen state that about 50% of homes don't sell during the first listing agreement with an agent.
What's your batting average?
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