listing prices out of line? (foreclosed, agent, sales, fees)
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Still looking for the right home.
And more and more puzzled by what sellers and their agents are thinking. There is this one neighborhood of very very similar homes. Just this summer, two sold for 310k and 370k (the latter one on the best street in the neighborhood). Now two homes were listed - but on a less safe street (this is an up and coming area) - for 400k and 450k. The 400k is in pre-foreclosure. The only real advantage they have that I can see over the sold comps is that they have an outdoor parking spot (in addition to the 1 car garage). The 450k is obviously staged. But everything else, especially the safety issue, is significantly worse.
Is there any point making a reasonable offer based on recent comps? My guess is not, as they are way out of line. How could an agent agree to such nutty listing prices in a neighborhood where homes are so similar??
I think some agents have given up on getting their clients to understand how pricing should be done in this type of market. Some people have no choice due to what they owe on the house, and others just feel that they should get what they want for it.
I would at least try if you like one of the homes and see what happens with an offer. Have your agent draw up a list of comps and write an explanation so they understand where you are coming from. If they can afford to do it (especially the pre-foreclosure who might be able to get a short sale approved) then you might get the house. If not, move on.
Some seasoned realtors just won't take on those kind of listings anymore, viewing them as a waste of time, some take them on assuming that they will be able to get the seller to be more realistic later and some don't know any better.
Agree with SaraSatin, many prices are being based on the sellers needs, not on the market - bid according to comps if you are interested and if they won't meet you, move on. You can't afford to pay for someone elses needs.
Still looking for the right home.
And more and more puzzled by what sellers and their agents are thinking. There is this one neighborhood of very very similar homes. Just this summer, two sold for 310k and 370k (the latter one on the best street in the neighborhood). Now two homes were listed - but on a less safe street (this is an up and coming area) - for 400k and 450k. The 400k is in pre-foreclosure. The only real advantage they have that I can see over the sold comps is that they have an outdoor parking spot (in addition to the 1 car garage). The 450k is obviously staged. But everything else, especially the safety issue, is significantly worse.
Is there any point making a reasonable offer based on recent comps? My guess is not, as they are way out of line. How could an agent agree to such nutty listing prices in a neighborhood where homes are so similar??
Sometimes that list price reflects the balance owed on the home not what it's worth. It's called being upside down and it's very common for foreclosures. I find realtors often want you to price your home very low (especially now) so it can sell quickly so it's definitely the seller driving a price well above comps.
Thanks for the input.
The 400k price is well above the loan that is being foreclosed plus agent fees...And the 450k don't owe much at all on the home (less than 200k). The market here has been stagnating - and given the recent sales, I am puzzled (I would also expect more foreclosures in this up and coming neighborhood, based on my research of refinancing for several of these homes).
Good points here. One thing that I think people tend to overlook or not understand is "what is driving the listing price(s)" -- and although it's a rhetorical question, it can be reflective of much larger issues. I've often felt that an agent's job is not only to "manage" a listing, transaction, etc. -- but also to manage a client's expectation.
I'm a buyer -- 365 days a year, and when I look at listing, offerings, etc., I sometimes wonder "what are these people thinking" -- however, as Jerry Seinfeld would say "who are these people", LOL. Who is driving that boat. Sellers can be unreasonable and way off, and although it is far less often, an agent can be too.
Although it is very much the exception, a friend of mine is selling a house in FL. He interviewed a few agents and picked one -- not the one who suggested the highest asking price. He put it on the market at the price the agent suggested. The property went on the market on a Wednesday and one week later -- the agent called up my friend and said "you should really consider dropping the price", so my friend said "OK, how much?"
The agent suggested a 15% drop. Now, we can all say this or that, and I am sure everyone would have their own story. I just find too many people are too quick to blame others.
For whatever reason, sellers who price high are not motivated sellers. Sellers who really want, or need, to sell in a buyer's market tend to be realistic about their options and price accordingly. They have to. Sellers who want to sell on their terms or at their price aren't really motivated-- they don't have to sell, don't really care if they do and aren't willing to negotiate much. Hey, their house, their choice. But as a serious buyer, there's no sense wasting much time with people who aren't serious about selling. Seek out motivated sellers and the process will go much more smoothly-- and far less time will be wasted. JMO.
I get apoplectic when I hear about agents who "buy" their listings by not being honest with the seller on price. 15% after one week? Unbelievable.
LOL my blood pressure is up just thinking about it.
No doubt. Very unprofessional. What surprised me, as I said, was that this agent didn't throw out the highest "suggested listing price". But to come back after one week is like saying you were completely wrong on the market, didn't know your market, etc. It can say many very disturbing things. What bothered me was "where" this suggestion was coming from. This agent is supposed to be working for my friend.
Personally, that is not a suggestion I would expect from someone who is supposed to be an advocate for me. He is not the highest on the market, not by far. He is far closer to the lowest (and his unit has many upgrades, inside and out, and is priced lower than smaller, lesser, etc. units). In my mind it's a completely inappropriate, unqualified, unprofessional, and outlandish suggestion.
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