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We put our home on the market in late July and will be purchasing my in-laws house -- it's bigger, same school district, great area, super cheap ...
Our home was originally listed for $215,000.00 and we got about 2-3 showings/week at that price.
In early October, we lowered the price to $210,000.00 as suggested by our real estate broker. We didn't see any more foot traffic through the home and its now been 2 weeks since we've had a viewing.
It's now one day away from November and our agent suggests we lower it again to $200,000.00.
Here's our scenerio:
Columbus, OH suburb Hilliard (desirable)
Columbus taxes - better than Hilliard's taxes by far
Hilliard school district -- highly recommended
2400 sq ft home
4 br, 2.5 bath
great lot
Cul-de-sac location
Friendly and clean neighborhood
Our home is in perfect condition -- to our knowledge there is nothing that will need repaired
The price is competitive with others in the area (except foreclosures)
Lots of foreclosures and short sales nearby
Unemployment is 10%
If we lower our price to $200,000.00, by the time all fees/expenses are paid out, we would OWE $700.00. Our new home is super cheap (family discount) and we would be able to start saving a considerable amount right away. The new home doesn't need any work except painting bedrooms for our color choice.
If that's all you would owe and you have something else lined up already, I would lower. I can't sell right now because I'm competing with foreclosed homes that some of which have been totally remodeled and are still selling for less than I owe on mine. I can't compete with that. I would stand to loose not only the equity I have put in over the last ten years but also most likely 10's of thousands of dollars more. I would say loosing $700 in comparison is not to much to loose IMO. The two main things hurting us are the large amounts of foreclosed homes to compete with and the high unemployment rate. Are you still paying mortgage on the place you have now? If so, that $700 is already disappearing as a mortgage payment every month, and more every month your house doesn't sell. It's also possible that you had more foot traffic before because of the $8000 tax rebate that ended recently.
At your price point the $5K drop did not amount to much. I am surprised that your agent did not tell you that.
If you are going to drop I would suggest going to $199,900. That will put you in a whole new price bracket and people looking to buy under $200K will now see your listing when they do a search. Again, I am surprised your agent did not explain this to you.
We put our home on the market in late July and will be purchasing my in-laws house -- it's bigger, same school district, great area, super cheap ...
Our home was originally listed for $215,000.00 and we got about 2-3 showings/week at that price.
In early October, we lowered the price to $210,000.00 as suggested by our real estate broker. We didn't see any more foot traffic through the home and its now been 2 weeks since we've had a viewing.
It's now one day away from November and our agent suggests we lower it again to $200,000.00.
Here's our scenerio:
Columbus, OH suburb Hilliard (desirable)
Columbus taxes - better than Hilliard's taxes by far
Hilliard school district -- highly recommended
2400 sq ft home
4 br, 2.5 bath
great lot
Cul-de-sac location
Friendly and clean neighborhood
Our home is in perfect condition -- to our knowledge there is nothing that will need repaired
The price is competitive with others in the area (except foreclosures)
Lots of foreclosures and short sales nearby
Unemployment is 10%
If we lower our price to $200,000.00, by the time all fees/expenses are paid out, we would OWE $700.00. Our new home is super cheap (family discount) and we would be able to start saving a considerable amount right away. The new home doesn't need any work except painting bedrooms for our color choice.
What would you suggest we do?
Putting house on market in late July in a supposed family/kids neighborhood is a problem right away. Way too late for people relocating with kids.
It might be worth waiting it out until next spring to catch the next wave of people with kids - in the mean time, keep it priced where it is as (the lowest that is acceptable to you) just in case you get lucky and a stray buyer likes your house.
There's always an initial surge of showings the first week - doesn't mean the house was priced right at $215K.
You'll have to make some assumptions and gut checks to see if continueing to pay the mortgage for another nine months or so is worth the risk you'll get a higher price next summer vs lowering even more now ($190K?, something that doesn't start with a "$2").
Also, important things you didn't mention, do you have kids? If so, that would be more incentive to stay so as to stay in the exact same schools. If you don't have kids then that is one less disruption.
The selling points are the cul de sac in a good school district.
Hard to believe there are lots of foreclosures on homes 2400 sqft homes selling for $200K and it is a good school district (I checked, it is pretty good). People couldn't swing $160K-$180K loans?
Bottom Line: this is like a reverse eBay thing "Buy It Now" for higher or "take a chance" that you can wait and it will be lower. Look at it this way, let's say there's a 95% chance you could sell it in the next two months if you lower your price today to $195K. You'd be done. You'd have closure. No more stress. You can move on. You'd have lots of time to earn or make the money back. And, you'd only be going down about 5% from $205K - big deal. Else, you'll have to stress it out for the next nine months.
Time in your life is more important than a few thousand bucks.
At your price point the $5K drop did not amount to much. I am surprised that your agent did not tell you that.
If you are going to drop I would suggest going to $199,900. That will put you in a whole new price bracket and people looking to buy under $200K will now see your listing when they do a search. Again, I am surprised your agent did not explain this to you.
Actually putting it at exactly $200K is even better because everything now is drop down box filters. $200K gets people looking up to $200K and people looking up from $200K. At $199,900 nobody filtering on $200K and up will see it.
We do have kids, 3, one in college - one in middle school - and one in grade school. They would all be able to stay at the same schools for the remainder of this year, then they will have to switch.
Yes, our unemployment is right around 10% - our neighborhood is middle-class and yes, we have a lot of foreclosures, unfortunately.
Last edited by AnnabelleM; 10-30-2010 at 09:42 AM..
Reason: correction
Keep in mind there is probably not much chance of getting actual list price. So while you have calculated a $700 loss it will probably be even bigger than that.
As someone else said you have to consider the cost of carrying the home while you wait and hope for a buyer, and possibly end up having to still cut your price.
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