I wrote the following letter to a homeowner that I've been working with in Great Neck, NY. I decided to share the letter on this blog since I believe it may apply to many others as well. There are many sellers out there who are feeling frustrated and confused about why their homes are not selling. The fact is, however, that many homes ARE selling.
I've created 3 categories for today's sellers:
(keep in mind that they all Need to sell)
Those who Sell
Those who don't sell
Those who won't sell
What I mean by "won't" are those sellers who won't accept the realities of today's real estate market. They've been bombarded with a multitude of misinformation circulating around out there. While the letter below is directed to someone who needs to sell but won't, the information can also be helpful to everyone that's currently invested in real estate. Enjoy!
Dear Mrs. XXXXXX,
I’m writing you today to update you on the real estate activity in the Saddle Rock section of Great Neck, NY. As of today, here are the available ranches:
• 35 Emerson Drive. This home has been listed since June 3rd. The original asking price of $1,100,000 remains unchanged. It's currently vacant and an open house will be conducted on Sunday 8/21 from 2pm-4pm.
• 10 Cooper Drive. This home has been listed since April 4th. The original asking price of $1,290,000 has been reduced twice and is currently at $1,199,000. This home has a basement.
• 5 Shelly Lane. This home is still on the market since November of 2010. The original asking price of $1,295,000 remains unchanged.
• 5 Walters Lane. This home was listed on June 27th. The original asking price of $1,418,000 has since been reduced to its current asking price of $1,298,000.
If you were to list your Saddle Rock Ranch today, your property would be competing with the homes listed above. Unfortunately, the market is not getting better. In fact, I strongly believe that we're still near the top of the market cycle. In other words, the real estate bubble has not burst yet in our area.
• 5 Walters Place sold for $655,000 in1999
• 25 Shelly Lane sold for $655,000 in 2000
• 35 Walters Place sold for $754,000 in 1999
• 195 Grist Mill Lane sold for $$740,000 in 2001
That's an average selling price of about $700,000. At the peak of the market in 2007, these properties were selling for around $1,400,000!! That's 100% appreciation in just 7 years!!
Now, we've lost about 25% from the peak of the market so far. So that should bring current average selling prices to around $1,050,000. Look at the current asking prices of the homes in Saddle Rock. Also look at how long they've been on the market. I think you'll agree that the $1,050,000 is right on the mark.
Losing 25% after gaining 100% in such a short time is not losing at all! In fact, if you consider that normal appreciation is about 3% per year, then prices are still higher than what they should have been if they appreciated at a normal rate.
But it won't stay that way. Prices will certainly continue to decline and possibly at an accelerated rate. It's still a seller's market for those who have owned their homes for 10 years or longer. It's not too late to take advantage of current market conditions but I'm afraid if you wait any longer, it will be. If you really want to get it sold, I implore you to list it with me ASAP for the correct market value. I promise that you'll look back on this and thank me for saving you literally hundreds of thousands of dollars!
Ron Cohen, CRB
Licensed Real Estate Broker
Gotham West Realty