There's nothing wrong with it! Except one thing…

By
Real Estate Agent with Wilson Than Real Estate

It goes without saying that we're all facing a number of challenges in the market right now.  Sellers think their homes are still worth prices paid in 2005 & 2006.  Buyers think home prices will keep dropping and, thus, make them more affordable.

But one reaction to current market prices makes me scratch my head a bit before I reply.

An associate and I were just talking about showing potential clients various listings in price ranges which would be very affordable to them.  In several instances, if the price of a property had fallen recently, the client would say, "Oh, well, something must be wrong with it."

Sure, something was wrong with it...the price!

I don't explain the price change with such curtness, but I do take a moment to explain that overinflated home prices have to fall to levels acceptable to the market.  Trying to explain pricing dynamics in a simple way can be a challenge when you want to describe all the economic factors at work right now.

I hope that if you've had a moment to read my blog entry today, you'll share your experiences with clients who need a little education with these market dynamics.

Comments (11)

Stanton Homes
Stanton Homes - New Home Builder - Raleigh, NC
Design/Build Custom Home Builder in North Carolina

Great point on educating buyers.  Today a dropping price doesn't mean there's anything at all wrong with the home or the property - it just means the seller is willing to lower the price in order to sell faster.

Aug 04, 2008 07:47 AM
Jennifer Esposito
JenRan Realty, LLC - Woodstock, CT

A lot of today's buyers are also making the assumption that all sellers are desperate.  You're right, buyers need a lot of education.

Aug 04, 2008 07:47 AM
Ron Moore
RE/MAX Professionals/Regal Builders - Retired - Florence, SC
MOORE Thoughts

My buyers tend to rejoice over price decreases; it's the DOMs that meke them say, "Something must be wrong with it."

Aug 04, 2008 07:56 AM
Kevin Gouchenouer
Century 21 Realty Concepts - Effingham, IL

I agree, great points and excellent comments.  Buyers are listening to much to the national media instead of what's going on in their local market.  We educate every chance we get, even ran several radio ads and press releases to inform potential clients our local market is different than what the national news is reporting. 

Aug 04, 2008 07:56 AM
Ida McCarthy
Ida McCarthy-Lombard Real Estate - Lombard, IL

All my buyers are thinking the prices are going to go lower because every week they drop.  So, of course, they are waiting to buy.  The hard part is getting them to make an offer NOW.  How much lower can they possibly go????

Aug 04, 2008 08:01 AM
Amy Salisbury
Leading Edge Properties - Charles Town, WV
West Virginia Realtor/Jefferson/Berkeley

Buyer education has always been important, but now even more so.  What kills me is when a property is priced correctly and buyers STILL want to offer incredibly low.  They do believe that all sellers are desperate and that they won't get a deal if they don't buy for $1,000's under list.  Its pretty aggravating...

Amy

Aug 04, 2008 08:02 AM
Maria Holland
RE/Max Homes & Estates, ABR,GRI, CDPE, SFR - Nashville, TN
Realtor, ABR, GRI, CDPE, SFR

The hardest thing is educating sellers that their home is just not worth what it would have been 6 months ago even.  They want to think that we are just trying to get a quick sale.  It is more than a frustrating time with buyers and sellers alike.

Aug 04, 2008 08:03 AM
AMY SHRADER
Hurst Real Estate & Auction - Morristown, TN

I have seen an increasing number of buyers who want to "low-ball" a price on a sales contract.  They call me and tell me they have found a house for $XXXXXX and what would payments be.  And then they'll ask me to figure payments on $10-30K less than that.  I hear  "Well its' been on the market for a while, I'm going to throw out this low offer just to see if they will take it".  We keep creating monsters in this industry.  LOL

Aug 04, 2008 08:11 AM
Trey Affolter
Keller Williams Realty - Tacoma, WA
Brings HOME Results!

I'm with you, it is our job to educate our clients. Too much inaccurate information has been in the media and out in the public. The market needs us Realtors and they need us to be educated. This is when we can take our industry to a higher level and show our true value in the industry.

Aug 04, 2008 10:57 AM
Steven Nickens
Wailea Realty - Wailea, HI
R(S)GRI ABR, Maui Real Estate Hawaii

I'ts always one thing.

Aug 04, 2008 05:01 PM
Jacqueline Guerra
Contractor State License Service - Temecula, CA

It's a pleasure to work with you. You are a nice, caring and intelligent person, and I think you are a blessing for anyone you meet. Thank you for all your advice, talk to you soon.

Aug 06, 2008 08:04 AM