Has your home been on the market for a few months now, or even longer? Maybe you’ve had a little bit of interest, maybe not. However, with the market we’re in today, if your home is in reasonably good condition and still isn’t selling, it’s time to start asking yourself some tough questions and consider lowering the price on your home.
Here are a few things to think about if you find yourself in this situation:
Locate the problem. With a Comparative Market Analysis (known as a CMA) of recent sales prices, hopefully you listed the house at an attractive price. However, maybe the booming market and wanting to make the most profit possible had you listing your home a little above market value, hoping it would appraise. This could be one reason you aren’t selling. People want to buy a home, but they don’t want to pay more than it’s worth. Other problems could be: did you make obvious repairs, and declutter and clean the house until it shines? Have you had an open house? Have you staged the home? Try to figure out why buyers aren’t seeing the value of the house in relation to your price.
Examine feedback. Review the feedback provided by prospective buyers who have toured your home. Your real estate agent can set this up for you. If buyers consistently list the same negatives, you’ve found your problem. Is your home a two-bedroom, one-bath model? Is there a busy road nearby? Does the home smell like cigarette smoke? Fix what you can immediately. What cannot be fixed must be addressed in price.
Seasonal Sales. Spring and summer are the busiest season for home sales. If you’re selling in the winter, buyers expect better deals and may have considered your home overpriced. This is also something to keep in mind when setting your home price. If you’re trying to sell your home in the dead of winter (maybe you have no other choice), but are trying to get top dollar, you’re probably going to end up having to drop the price to a more reasonable number for that time of year.
Search parameters. Is your home price just above a common online search parameter? For example, prospective buyers may search for homes ranging in price from $200,000 to $250,000. If you price your home at $260,000, your home will be excluded from many online searches. If you want to sell for $250,000, a savvy agent will steer you toward listing at $249,900 so that you don’t fall just outside of buyers’ search parameters, thereby missing out on good prospects.
Agent expertise. A good agent should be investing significant time and effort in marketing your home. Good marketing can be everything! Relying solely on the Multiple Listing Service and a sign in the yard is not a good strategy. Your agent should assist you in staging your home correctly, getting professional photographs taken, sending direct mail advertising, and posting your listing to social media platforms. When your home does sell, you’re paying a lot of money for the agent’s services, so make sure you’re getting the best possible! If the agent you’re using took pictures on their phone and doesn’t advertise your home anywhere else besides MLS, these are not good signs of a good agent. First impressions are everything and good marketing helps your home make a great first impression.
How much to reduce? If, in the final analysis, you need to reduce your price, carefully consider all the factors discussed above and make a decision with the help of your agent.