Wednesday, September 5, 2007

What is the right price in this market?

The home we want is priced right … what should we offer?

Many Buyers are compelled to offer low because they’ve read, or been told, to do so. Others think they have to do it because somebody did it to them in another market. If the home you like is priced right … get what you can and buy it.

Smart Buyers are making offers based on their knowledge of the market and hopes for a good deal. Ultimately they are accepting a negotiated price and getting what they want at a good value regardless how it compares to the listed price. We recently saw an offer 22.2% below the list price of a well priced property. The Buyers had to try it and they did. Fortunately, they knew the market and recognized that the property was well priced. Ensuing negotiations resulted in a price but .7% below the list price, less than a 1% reduction! Both parties were happy and achieved their objectives.

The values are all over the board these days. We recently showed property and found homes three doors apart, the same plan by the same builder, that were priced $30,000 apart. They were essentially the same house. One was priced right – the other deserved a “wake-up” offer. In another neighborhood we experienced a discrepancy of $60,000 between similar homes. In that case the lower home was priced by a very active local agent that had great knowledge of the market. The other agent was from out of town and unfamiliar with the market. Sometimes out of town agents are relatives, but more often they are sought out by Sellers because the local knowledgeable agents wouldn’t tell the Seller what they wanted to hear. Both of the homes $60k apart are still unsold, but which do you think has a better chance of selling?

Sellers and their agents must look realistically at what they are trying to achieve and plan accordingly. It doesn’t matter what you paid or what you owe – market is what market is. If you want, or more importantly, have to sell then get a realistic Realtor. One that will tell you the truth and make a plan that works for you for your situation, not just say what you want to hear so they get a listing hoping one of two things happens: 1. they find a fool and his money – rare in today’s market, or 2. they list high at what you are hoping for, and then beat you up for a price reduction week after week, you concede and their slimy tactics are rewarded … for them.

Our Advice: Because of the great discrepancy in prices in the market place one must be really sure when pricing. If it is priced right … really right … you will sell. What your home was worth in 2005, or will be worth in 2009, is irrelevant. If you want to sell today you can … if you are positioned in today’s market in a today manner. That includes price, condition, showing availability, experience … and intention. If you don’t need to sell – don’t right now.

If you need or want to sell … do it right, price it right, and you will be moving. The days of the uneducated Buyer are over. If you are waiting for someone to come in and pay too much you might as well hunker down for a long winter. Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates,, 775-781-5472.


Successful Agent said...

In the past few years I've been researching who are the successful agents, tried to figure out why top agents are top agents.
Do they have a common educational background? No. Good ones have high school diplomas, masters and doctorates. No correlation.
Similar previous careers? No. One of the best agents I know used to teach baton twirling. I doubt if I could find a lot of those if I tried! I've had waiters, teachers, high powered executives and stay-at-home Moms who were all very successful.
Common interests? No. Other than eating, (which we Realtor-types seem to do exceptional well) the interests are widely diverse.
After 13 years in real estate sales and management, I've only found a few constants.
1. Successful agents treat the real estate business as a business. They actually have a business plan and a budget. They understand that you have to spend money to make money. They know how many sales they need to make the income they require and then they figure how they'll get from here to there. They plan in advance and execute the plan.
2. They actually work when they work and play when they play and take a day or two off every week. (Just like a "real job!")
3. They have fun and enjoy selling real estate but know that it won't be forever.
4. They buy a lot of real estate for investment when they see good deals because they know that no one gets rich selling the stuff. You get rich owning it! Financial independence gives one a lot of freedom, autonomy and a certain air of confidence that smells like success.
. . . And people like to do business with successful people so they do more business!
That’s why I choose this realtor for my future.

Valorie Bradley said...

Hi Lisa and Jim,

Just checking out real estate blogs in the SW and found yours. Looks great!

Valorie Bradley
Long Realty
Tucson AZ