This was a featured post yesterday and very worthwhile sharing with sellers who are on the market or thinking about selling their home. Pricing is very important and its best to start priced right but if you dont here is what you need to do.
Deciding when to drop the listing price is difficult because it depends on the region and market. There's no one formula that will work across the board. However, there are guidelines that I think work in most situations. Here are a few standards I think work everywhere...
When the feedback says "It's too high!"
If the agents and buyers are coming back with pricing suggestions or verbal offers, and those are in line with the comps your priced above, then you're priced to high. That's the point you should drop the price. Don't wait for "the perfect buyer" to come along - it'll never happen. You'll increase the chances of a sale by dropping it immediately.
When you haven't had a showing in 30 days
With the exception of open houses, which don't count, if you haven't had a call to either preview with an agent or show a client, you need to drop the price. Regardless of the price range, if you're not getting at least one showing a month, the price is too high. If it's priced right, you should be getting a lot more showings. How much to drop depends on the property but drop it enough to get showings.
When a similar property sells for less
If a property in the same market that is a good comp sells for less than your asking price, drop the list price to capture buyers who were looking at that other property. If you want a little negotiating room, fine, but come to within 2% of the other listing price as soon as that home goes to "pending sale" status.
When the last price drop was 90 or more days ago
If the last price reduction was 90 or more days ago and you don't have a serious buyer on the hook, drop the price. Even if a buyer is considering the property, drop the price. Dropping the price will engage more buyers and existing potential buyers will be motivated to write an offer before someone else does. I've seen sellers sit on properties for months while potential buyers make up their mind. The result: wasted time and opportunities.
When you list with me, I'll work with you to price the home right to start. However, if the price starts out higher, I'll walk you through all the data-driven rationale behind bringing your price down to get a buyer.
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Bryan Robertson, Broker Associate | T: 650.799.9951 | Email: bryan@serenogroup.com | Website: http://www.BryanRobertsonHomes.com |CA License: 01191946 | Sereno Group - Los Altos branch | 369 S. San Antonio Road | Los Altos, CA 94022
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Chuck Carstensen is a Realtor with The Discovery Team (RE/MAX Results.) in Elk River, MN. Helping buyers, sellers and investors in great Minnesota counties like Sherburne, Isanti, Wright, Anoka, Chisago, Hennipen and Mille Lacs. He is a Certified Distressed Property Expert (CDPE).
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Thanks for reblogging Chuck. This topic has gotten a lot of attention.