The housing market is full of a mix of Foreclosures, Short Sales and Traditional Sellers. Traditional Sellers today have fewer foreclosures, short sales and other traditional sellers to compete with than last year but the competition is still heavy since we still have far more home inventory than we have buyers for it.
A while back I did a market analysis for a potential seller and while their current competition’s prices were all above $200k, all the sales of comparable properties were well below $200k. What’s worse is that most of the homes that did sell only sold after 200 to 300+ days on the market. The pattern was very consistent!
I showed this to the sellers and explained to them that while their active competition may suggest a higher list price, a list price below the competition will mean that prospective buyers are far more likely to negotiate with them rather than the others for sale.
At the end of the day, they did list below $200k and saw good showing activity and open house traffic and accepted an offer in just a couple weeks on the market. The seller saved literally months on the market and were negotiating from a place of strength (short market time, good interest, good feedback) versus a weak position that you find yourself in when a home has been on the market for several different seasons.
Some sellers still believe that they cannot “give away” the house at the price the market indicates so they list the home higher in hopes that the “right buyer” will come along and give them their price. Well unless the home is extremely unique or extremely coveted this strategy consistently fails.
The market price is what the market price is – in this market there are still a lot of sellers on the market that can’t or won’t sell at the market price, but that number seems to continue to diminish as more sellers come to grips with the realities of what is still a difficult housing market.
