Many people think that in a seller’s market, like the one we are seeing here in Colorado, that you can drop a Realtor sign in the yard, place a high price on the home and still sell it. I would certainly beg to differ. Yes, at the price points in the high 100’s to mid-200’s, we are finding a fraction of buyers that will pay over appraisal or cash buyers that sometimes buy without an appraisal. I have been involved in these transactions and they are few and far between.
More commonly what I see in this market is sellers being overly price aggressive based on what the media says about the market or what a friend of a friend had happen, and place a price tag on their home that in the end costs them money. Home information is all over the internet. Buyers have unlimited access to sold data, under contract data and specifications of any home on the market and can, with reasonable intelligence come up with an approximate range that a home should sell for. If your home resides too far outside this range, your home sits on the market longer than the average. Buyers begin to wonder if there is something else other than price that is causing your home to sit on the market so long. You are forced to make a price drop. Now you are 3 weeks into the listing and your home has no offers and you take another price drop. As your home begins to fall into the correct range, buyers start to come back and sniff at the home. They also see that you have now taken multiple price drops and have been on the market longer than any house in the area. What do they do? They make an offer, usually at the lower end of the correct price point or below. For goodness sake, you lowered the price 3 times and have been on the market 6 weeks…. surely you are getting desperate and will lower your price again!!! In the end you settle for a price lower than you would have achieved had you priced the home correctly in the first place. If you find yourself in this position making small price reductions, I would suggest you figure out your absolute bottom sales price, drop the home to that price and stick to your guns. Small price reductions are killers in this market. Better yet, find a full-time, professional realtor with experience in your area and lean on their market expertise in the beginning. Don’t let the market fool you!
If you or someone you know needs help buying or selling a home, be sure to call me and my team for an opinion on your situation. I can be reached at 303 929 8954 or at my private email at firstname.lastname@example.org
Best of Luck!