When To Reduce Price On House For Sale

[madrocket]

I didnt read all the posts but i will give you my experience. I put my house in katy up for sale in Feb 2009 and it took 4-5 months to sell. I wouldnt read too much into the feedbacks. I listed my house at $210k (appraised value in 2008), lowered it to $199, then $190 and got it sold for $185k.

I dont have many nice things to say about realtors. I always asked him to list the house at what he thinks it sells for. He didnt have no idea (and this is Top 5 guys in Katy). So I decided my numbers and had a number that I wouldn't go below.

Few things to remember:

1. Don't read too much into feedback. Most of it is useless.
2. If you can wait please do. You have a nice house and dont want to give it away.
3. Decide on a number and advice your realtor to get to that number in increments. I wouldnt tell the final number to the realtor.
4. Don't bother calling realtor/CSS if there are no shows or if someone does not leave a feed back. That is normal and people usually see a loooooooot of houses before they buy. I have a 4year old daughter and it was miserable to leave the house for few minutes and come back. So I actually put some hours that we can't really show (lunch, nap time etc).
5. If you can afford sending your family on a vacation for few days please do so. I got tired of the requests during lunch. They were gone for a month. The first weekend I had 10 showings and one of them bought the house.

I actually signed a contract to build a new house (after the first offer) which was 4 months after listing. The guy backed out but I kept building the new one. Luckily I got another offer within 2 weeks.

If I had to do this again, I will move to an apartment before putting the house on sale.

Hopefully some of this will be useful.

[cheryjohns]

Originally Posted by nimbusdog

Just thought I'd give an update in case anyone was interested on what's happened since I last posted. Unfortunately, the market is tough and we haven't had any bites yet.

1.) Oct 12th. Agent makes appointment and no shows. When my agent emails her, she says CSS never called her back to confirm appointment.

2.) Oct 15th. Agent leaves feedback that their clients liked the house and stayed about 20 minutes. They want to bring their son to see the house. I haven't heard anything back since then.

3.) Oct 16th. CSS auto-declines a showing.

4.) Oct 17th. Renter in my neighborhood calls my agent for showing. She shows him the house, and he likes it. He says he doesn't want a payment of more than $2150 a month. My agent tells him he needs to look at a different price range because the rule of thumb is that payments are 1% of sales price, which would result in a $2900 payment. I wasn't too happy about this because I think this is a very bad rule of thumb, and doesn't apply at all in my situation. It's very easy to run the numbers, and even with only 5% down, and a full price offer, the payment would be right under $2150.

You are right - and that includes insurance and taxes. The 1% rule of thumb worked pretty good when interest rates were about 7%.

5) Oct 20th. This is the first feedback that we receive that the house is "somewhat overpriced", but buyer also leaves feedback that they love the outdoor kitchen.

6.) Oct 21st. We decide to drop the list price to $289,900

7.) Oct 23rd. Open house. Agent says there were 11 people that showed up, but most from the neighborhood. One very interested person, but only preapproved for $200k.

8.) Oct 24th. Another showing. Leaves positive feedback, but nothing else.

We heard from the agent from the Oct 20th showing last week that her buyer really loved the house and she expected them to submit an offer. She asked if the refrigerator was included and we replied that it was certainly negotiable. My agent emailed her back on Monday to follow up and she replied this morning that her buyers were scared away. She said they looked up the appraised value through the CAD, and that it concerned them greatly and that they were "really concerned about the true value of the home." Part of this is my own doing because I protest the appraisal value every year and get a reduction. This isn't because I think the appraisal value is above market, but because they will give you an automatic $5-10k reduction just go get you to go away. This year, I got an almost $11k reduction completely online. To me, this is a benefit because it lowers the taxes. I would never base market value off of the CAD. I don't know how much of this is a real concern versus posturing to setup a negotiation. My agent wants me to make them an offer. She suggested that we offer them our bottom line, which I really don't want to do. I think whatever offer we make will just be used as a starting point, so I don't think the first offer should be the bottom line. Even if we say that's our bottom line, nobody will believe it.

Any agent that has had more than 15 minutes experience knows you don't go off of CAD value, but sold comparables. You did the right thing in keeping your tax values low - it should be a selling point not a negative. I have had people call me and ask should they have CAD value raised to reflect the real value. The answer is NO! You always want you house to be lower on CAD.

I had a buyer once where the house was way over-inflated on HCAD. We negotiated the overpayment of that year's taxes off the settled upon price, because I did not want my client to have to pay for the previous owner's ineptitude in keeping the value from rising above the market rate. (We only had to worry about the one year - it was going to get re-set with the sales price.)

[westsideteacher]

Don't look at the for-sale comparables, look at the SOLD comparables!

[piyf]

Your Realtor wants YOU to submit an offer being the seller? And your bottom dollar? Wow

[cheryjohns]

Originally Posted by danieloneil01

Your Realtor wants YOU to submit an offer being the seller? And your bottom dollar? Wow

That struck me odd, too. I figured maybe something was lost in translation. A better deal would be for the seller's agent to send the sold comps to the buyer's agent, since the buyer's agent appeared too dumb to do it him/herself. I did the comps in the beginning of the post - the price is justifiable.

[nimbusdog]

Originally Posted by cheryjohns

That struck me odd, too. I figured maybe something was lost in translation. A better deal would be for the seller's agent to send the sold comps to the buyer's agent, since the buyer's agent appeared too dumb to do it him/herself. I did the comps in the beginning of the post - the price is justifiable.

You didn't lose anything in translation. That's exactly what she said to me. She said that once the buyer gets scared, you have to do something to entice them to move forward. She did send over the comps, but she also asked me to make an offer to them at a lower price and/or offer to pay some closing costs.

[cheryjohns]

Originally Posted by nimbusdog

You didn't lose anything in translation. That's exactly what she said to me. She said that once the buyer gets scared, you have to do something to entice them to move forward. She did send over the comps, but she also asked me to make an offer to them at a lower price and/or offer to pay some closing costs.

Hmmmm. Weird. If they had made you an offer, you can counter by dropping a little - but they never made the offer in the first place. My thought is they were never a serious buyer and will always freeze at the critical moment - or they have a numbskull agent who is clueless as to market value VS. CAD appraisal. If that is the case, then they won't think they are getting a good deal until they find a house that is over-paying taxes because it is over-appraised - which is amazing. I think it's people like that that make us the fourth dumbest city.

[crone]

Way to go, Cheryjohns. That's telling 'em how the cow ate the cabbage.