There are many agents out there who only have one answer when their sellers ask them why their home has not sold: Lower the price. But that isn't always the answer (it‘s the easy answer, but not always the correct answer). It is up to the agent to take a hard look at why the home is not selling and recommend things that need to be done to properly market the home. In the current Payette and Malheur County markets, it is imperative that a home is seen as the best buy currently on the market. How do you do this?
I had a seller who purchased a house 6 months earlier and moved into it. The house had been on the market a while and they were able to get it for $125,000 (it was originally priced at $150,000). It was a very nice, well-maintained home with plenty of square footage, but it had really outdated paint and carpet (avocado green to be exact). They cleaned, painted, and had new flooring installed at a cost of about $8,000. Then 6 months later they got a wonderful job opportunity in a town 200 miles away. We put the house on the market for $160,000 and a couple of weeks later another agent brought some buyers to look at it. As they drove into the driveway, the buyers commented that they had already seen the house when it was on the market a year earlier and they didn't like it - the house was very dated and it would cost $30,000 to update it. The agent had seen the home on an office tour a couple of weeks before and she had really liked it, so she convinced the buyers to go in and take a look. When they got inside they were absolutely amazed at the transformation and loved the house, so they drove back to the office and made a full price offer. So, in essence, they paid the seller $35,000 to do cosmetic fix-up because they had no vision or imagination (which 80% of buyers DON'T), and they seriously over-estimated how much it would cost to do the work on the house (which 80% of buyers DO). If the sellers had not done the updating on the house, my guess is that it would have sat on the market for a very long time and it would have been difficult for them to even break even.
In another example, I listed a home that had been on the market for over a year with two other agents. It was in a very nice location and a Market Analysis showed that the house was priced correctly. But the home had kitchen carpet and almond-colored appliances. I asked the seller's to replace all the appliances with new stainless steel units and to replace the kitchen carpet with slate-look ceramic tile. The upgrades cost the seller about $6,000. We raised the price on the home by $10,000 and it sold within six weeks.
I took another listing that had been on the market over a year. I asked the seller to complete several minor repairs on the property and raised the price - we had a full price offer on it in two weeks.
It seems to me, when homes have maintenance issues or dated decor, it doesn't matter whether you lower the price or offer a "decorating allowance", the buyer still perceives the house as less desirable and they want to low-ball the price even more (if you can even get them to make an offer). If a buyer decides that it will cost $10,000 to repair or re-carpet a house, that is what they will reduce their offer by, it doesn't matter where the price is at that moment. That is why I always try to convince a seller to go ahead and make the repairs or redecorate with paint or carpet rather than lower the price, if condition is the issue. Then the buyers aren't discounting the price in their minds when they are looking at the house and thinking about how much work it needs.
So the answer is finding an agent who really understands the market and the psychology of buyers minds and how they think. Yes, sometimes we are all guilty of taking an occasional listing that is priced too high and the answer is to lower the price. But, rather than just a knee-jerk reaction, the agent should carefully analyze what the REAL reason is that the home has not sold and adjust accordingly. That is what sellers hire us for, after all.
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