The best question I can ask sellers today is… “Do you want to sell your home, or gamble your equity?” What I mean by that is simple. We can price your home to SELL, which likely means going lower than you wanted to. Or, we can price it higher and take a gamble on losing some of your equity. When we price the home higher than the competition, we will be gambling that someone comes along and buys it out of the dozens for sale they’ll have to choose from.
Let’s be clear. This is purely a gamble. When your home is for sale in a declining market, prices don’t go up. They go down. So you end up chasing the market down with your pricing. If the thousands of media reports haven’t yet convinced you to pay extra attention to your price, perhaps the graph below will.
Let’s break down exactly what this graph is telling us.
0 – 30 days, sold for 99.27% of asking price
If you’ve priced your home to sell within 30 days of listing it, you’ll get your asking price! And, they’ll pay CASH. There is very little negotiation on the price because buyers see it as such a great deal and will offer what you’re asking. However, only 11 sellers this year have taken advantage of this strategy. That’s less than 2% of our SOLD market.
31 – 60 days, sold for 95.88% of asking price
Basically you’re still priced to sell. But, buyers felt there was a little negotiation room. Chances are, you came on the market at or slightly above market value. The good news is a whopping 12% of sellers took this strategy.
61 – 120 days, sold for roughly 91.5% of asking price
This group actually makes up two columns on our graph but since the numbers were so similar, let’s look at them together. Let’s face it, 61 to 120 days on the market is not a ridiculous amount of time. However, it’s enough time in a declining market to sell for 9% less than your asking price. To sell in this time frame, you weren’t GROSSLY overpriced.
However, this group is probably the silliest. Let’s figure 2 to 4 months of carrying costs while your home is on the market. Chances are that amount of money is probably the same difference your agent asked you to list for to begin with. Yet, you went higher and it cost you the in the end. 25% of our sellers this year so far chose this route.
121 – 180 days, sold for 83% of asking price
An average listing agreement is a 6 month term. Why? If you’re not priced to sell, you’re losing. If it takes you 6 months on the market to figure out the right price, either you’re not paying attention to your agent, or they’re not giving you good information. If it’s you, call them right now, apologize and correct the price so you don’t lose any more equity. Almost 18% of sellers this year can attest to this.
181 – 365 days, sold for 83.55% of asking price
This is an interesting statistic to me. I suppose if you’re on for 6 months, what’s another 6? You’re already down 17% from where you started. My guess would be the listing expires after no price change for 6 months. It’s then re-listed with another agent for a slightly lower price, then everyone gets real, adjusts the price accordingly and it sells. It’s a vicious cycle. Because this group is the highest percentage of sellers at 24%, the best advice is get off the merry-go round!
366 or more days, sold for 72.53% of asking price
I don’t even know what to say here. This number clearly shows you can’t win by chasing the market. Sadly 18% of sellers this year ended up in this group. If your agent isn’t updating you weekly, find out why. If they are, listen to them. It will save you money.
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