Friday, March 2, 2007

Do you really want to SELL your house?

Here's a fun one.  I had buyers this week make an offer on a property that was vacant and had been on the market for five months.  It was probably the nicest home in the neighborhood, but it was priced high.. very high.  We ran a Comparative Market Analysis (CMA) on the neighborhood as part of our research process, and the highest price** per square foot on the page (not including this home), including Actively for Sale, Expired Listings, Sold in the last 6 months, and Currently in Escrow, was $220/sqft.  The average for all the other homes for sale was $199/sqft.  This particular home was asking $250/sqft.

My buyers liked the home a lot, and were willing to pay absolute top dollar (and maybe even a premium), as they wanted to live there for many years and weren't concerned about making a profit.  But they weren't willing to be stupid, either.  We made an offer of $220/sqft, and shared our analysis & reasoning with the seller's realtor.  Oh, and by the way, my buyers are going to pay cash, which eliminates the potential for a loan to get declined and mess up the deal.

The sellers flat out declined our offer.  No counter offer.  No negotiating.  They want their full price, and they're willing to wait for it.  That's fine - to each his own, but in the meantime, please do everyone else a favor, and wait for your price to be realistic!  Or at the very least, you should notate in the MLS that your price is firm and request that no one make a lower offer.  Your realtor is wasting time & money marketing a home that's not going to sell.  Buyers are wasting their time looking at your home believing that you'll settle for a reasonable price.  Other realtors are wasting time previewing your home, and then showing it to their clients.

If you really want to sell your home, be realistic - even optimistic.  You've got the best house with the best amenities on the best lot, and you're not in any rush?  Great, ask for a nice premium to the market.  But don't go where no one will follow - that's just a waste of everyone's time & energy.

Thanks,

Chris

** I'm using round price per square foot numbers to make the sample easier to follow.  Our actual scenario had adjustments for different size houses, lot locations, and amenities.