Wednesday, December 26, 2007

We Can’t Reduce Our Price Any More … What Can We Do?

Whether you can’t, or won’t, reduce your price, we understand that it is frustrating to sit in this market without action. The best way to generate action is to reduce your price to be the best priced property on the market for what you are offering. Having said that, here are a few options available to you other than a price reduction.

For some Sellers a lease/option can help you achieve your goal. A lease option is in actuality a lease agreement, and an option to purchase agreement, that are tied together by language in the agreements. A lease/option provides you with cash flow from the option consideration and monthly lease payments while you wait to see if the option will be exercised. Since the price paid at the time the option is exercised is agreed to at the time the option agreement is signed, it is usually a higher than market price. This is because of the extended term of the option period, typically 12-24 months, and the anticipated increase in market value at the end of the term.

Lease/options can be a risk for both parties since nobody really knows what prices will do, but it gives the Seller cash and cash flow, and buys time for the market to change. The Buyer can get in to the home knowing that they have the opportunity to buy it in the future. This works well if they, too, are waiting to sell, repair credit, or any number of reasons that are holding them back from a normal purchase in today’s wonderful Buyer’s market. The fact that Sellers today are considering lease/options is another sign that it is, indeed, a Buyer’s market.

If you know where you want to go after you sell, look in that market for somebody that is looking to move to our community. A simple ad in their local paper might produce a Buyer that can’t sell their home. So what do the two of you do? Trade your homes! You might advertise your willingness to do so in your local
Carson Valley advertising. We’ve found that people looking to move to the Carson Valley look here in preparation for their move. A needle in the haystack? Yes, but with the right intention you just might beat the odds.

Our Advice: There are a number of other options, each with its own inherent risk factors, and one should be careful when considering such an option. These include selling with a Contract of Sale, All Inclusive Trust Deed, or simply renting your home until the market recovers sufficiently to allow you to accomplish your next real estate objectives. Auctions have a certain intriguing appeal, but have not proven very successful from our observation unless it is involves a distressed property, or a very unique and expensive property. Be flexible and maintain a bigger perspective when weighing your options.

Remember, it is only money. Don’t let yourself get so affected by this market that you lose your health or family … money can be replaced. Experience is Priceless!
Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, www.carsonvalleyland.com , 775-781-5472.

Easily search the entire
Northern Nevada MLS or email Lisa and Jim with questions or for additional information.

1 comment:

mark said...

Hey, I just wanted to say Happy New Year and thanks for an excellent real estate blog. Please don't stop writing this stuff it is excellent. By the way, there is an excellent article on real estate at the New York Times here is the link: http://www.nytimes.com/pages/realestate/index.html?excamp=GGRErealestatearticle&WT.srch=1&WT.mc_ev=click&WT.mc_id=RE-S-E-GG-NA-S-real_estate_article

God Bless!
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