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My house has been on the market for 2 months in Cary (in the $250 k range). I overpriced initially, and only had 2 showings the first month. After dropping the price, the 2nd month was much better (about 2-3 showings per week). Comments from showings have been mostly positive, but no offers yet. After 60 DOM, is it time to drop price again, or should I wait since showings are not too bad? I was thinking about offering to contribute $5-$10k toward buyer's closing costs, but should I hold back on that knowing the buyer will want it anyway? I'd really like to push this now, since I'll worry if it gets into fall without a sale. Any advice?
I think you are probably better off just reducing the price. Or reducing the price and offering some closing costs. In the $250K range, $10K is way too much for closing costs anyhow unless the people are paying 3 points or something. Before deciding on a price reduction though, I'd sit down with your realtor and revisit comps and look at what your competition is selling at. Also, make sure your house is in tip top shape. From what I'm seeing, even in this market people are definitely willing to pay a little more for a house that's been updated nicely, has neutral paint, etc.
In my book AS A SELLER, agreeing to a concession in closing cost is only a few dollars less taken home from the balance sheet due to increase commission. It means much more to the buyer depending on how strapped for cash they are with what they can bring to the closing table. There are a couple of reasons I can think of that are exceptions to that, like maybe a relocation company is handling the transaction, or maybe a cautious seller getting peace of mind in the ability of the buyer to pay closing costs as another security that the buyer is financially stable enough to close the deal.
I'm not a Realtor so I don't have a qualified professional opinion but from a personal standpoint I'd just reduce your price and worry about the details of closing costs etc. once you have an offer to negotiate.
I think you are probably better off just reducing the price. Or reducing the price and offering some closing costs. In the $250K range, $10K is way too much for closing costs anyhow unless the people are paying 3 points or something. Before deciding on a price reduction though, I'd sit down with your realtor and revisit comps and look at what your competition is selling at. Also, make sure your house is in tip top shape. From what I'm seeing, even in this market people are definitely willing to pay a little more for a house that's been updated nicely, has neutral paint, etc.
I have seen a couple of brokers and banks charging some ridiculous junk fees. Also, the amount of pre-paids required by the lenders varies. If someone wasn't shopping their loan, paying junk fees, high origination, and at least a point reduction, I could see them getting close to the $10k mark.
The bigger problem I'd guess would be that some lenders would not allow this much of the closing cost to be paid by the seller.
Id lower the asking price rather than offer $ for closing. A lot of ppl moving in to the area are getting relocation packages from their employers which often incl closing costs.
I have seen a couple of brokers and banks charging some ridiculous junk fees. Also, the amount of pre-paids required by the lenders varies. If someone wasn't shopping their loan, paying junk fees, high origination, and at least a point reduction, I could see them getting close to the $10k mark.
The bigger problem I'd guess would be that some lenders would not allow this much of the closing cost to be paid by the seller.
I think you can only pay up to 3% of the total loan. In regards to lowering the price or offering closing costs, what feedback are you getting from the showings? There is some reason they are not buying your home after viewing it. Of course a lot of people right now are "just looking". I think that if the closing costs made a difference, someone would have put in an offer and asked for it.
We were offered 5k in closing costs and 5k in down payment assistance, and free appliances in a to be built home. Offering closing costs in my opinion helps but then again the buyer will probably ask for it anyway in their offer.
Thanks to all of you! I really appreciate all of this good advice! I think I'll wait another month, then lower the price if I have to, and keep the closing costs to make the final deal.
I have been searching for a home in the area, and I have a couple of observations from my point of view---maybe they will help you or someone else.
Make certain that there are MANY flattering good photos of your home online. Double check that there is a lot of detail in the description of the house and property (that area where you would have gone through a checkoff list). Those first few lines of comment are important. Who knows how many homes I passed up because their online listing was below par?
Get the house as clutter-free as you can. Make certain the kitchen and bathrooms are spotless and happy!
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Price creates traffic.
Double Check.....
