Why would a seller raise the list price of a house that isn't selling? (agents, sales)
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Maybe all the experts here can answer a question hubby and I have. In the next year or two we want to buy a new house with acreage near our current metro area so we've been keeping a close eye on listings and sales of country properties in the area.
Our metro area overall is a red hot market (up 15 - 20% in the last 2 years) with a low inventory and most properties within city limits under a certain price range are selling in hours or at most a few days. The country properties in the areas we are interested in are not selling as fast, but are still selling within 1 - 3 weeks if they are well priced. What we have noticed is that many of the rural properties must not be well priced because at least 50 - 70% of them sit on the market for months to years and either don't sell at all or end up finally selling when the price is dropped low enough, which is sometimes $100 - $200k or more less than the original list price.
A particular property we've been watching for awhile has been listed/delisted several times in the last year, never having the price changed. After it was listed for a long time, they delisted and then relisted it adding an additional few acres and a barn for again the same listing price. Since then it has been listed for another at least 8 months without selling. Then last week, they again delisted it, then yesterday relisted with no changes to the property or what is included, but increased the list price by $50k (7% increase). To finally get to our question, why in the world would the sellers increase the list price of the property by $50k if the house wasn't selling when it was $50k cheaper? My gut feeling (and I am not an expert) based on comps that we can find online and other listings in the area is that the house was $50kish over FMV before and after the increase is now $100kish (14%) over FMV.
These are the two theories I have (1) they somehow think the summer market for rural properties is going to be so hot that the market will somehow rise the $100k (14%) it would need to in order to make their house listing price come close to FMV or (2) they've been receiving offers for $50k under listing and think that if they raise the listing price up by $50k that the offers they get will also come up $50k to match the original list price. I'm curious what the experts here think.
I have been in the business for 10 years and I have seen all kinds of whacky ideas come from sellers and buyers alike. it could be the sellers would rather listen to a friend then to their agent. We once had a tough to sell condo office space which we listed at a good price but didn't have buyers busting down the door. After a time on the market another seller in the same unit that had been trying to sell his over priced unit for months told our seller that she should raise the price? She of course came to us questioning whether we should raise the price?? Weird.
More than likely in your situation the seller is trying to take advantage of the Spring market and market increase in your area.
What sellers don't know is that as agents we have access to the property history and we can see that they were willing to accept less before. If the buyers are not lining up this knowledge can be used to get a better deal.
Rural properties can be a tougher sell since they are not for everyone so it can take extra time to sell them. If these sellers were smart and they got a buyer interested they would be smart not to try and play games with the pricing.
1. They don't need to sell.
2. They are hearing about rising market and say "what the hell". In my neighborhood (Berkeley in Denver, CO) builders do this all the time. The market is increasing at more than 1/2% per month.
3. They want their price, damnit.
Maybe all the experts here can answer a question hubby and I have. In the next year or two we want to buy a new house with acreage near our current metro area so we've been keeping a close eye on listings and sales of country properties in the area.
Our metro area overall is a red hot market (up 15 - 20% in the last 2 years) with a low inventory and most properties within city limits under a certain price range are selling in hours or at most a few days. The country properties in the areas we are interested in are not selling as fast, but are still selling within 1 - 3 weeks if they are well priced. What we have noticed is that many of the rural properties must not be well priced because at least 50 - 70% of them sit on the market for months to years and either don't sell at all or end up finally selling when the price is dropped low enough, which is sometimes $100 - $200k or more less than the original list price.
A particular property we've been watching for awhile has been listed/delisted several times in the last year, never having the price changed. After it was listed for a long time, they delisted and then relisted it adding an additional few acres and a barn for again the same listing price. Since then it has been listed for another at least 8 months without selling. Then last week, they again delisted it, then yesterday relisted with no changes to the property or what is included, but increased the list price by $50k (7% increase). To finally get to our question, why in the world would the sellers increase the list price of the property by $50k if the house wasn't selling when it was $50k cheaper? My gut feeling (and I am not an expert) based on comps that we can find online and other listings in the area is that the house was $50kish over FMV before and after the increase is now $100kish (14%) over FMV.
These are the two theories I have (1) they somehow think the summer market for rural properties is going to be so hot that the market will somehow rise the $100k (14%) it would need to in order to make their house listing price come close to FMV or (2) they've been receiving offers for $50k under listing and think that if they raise the listing price up by $50k that the offers they get will also come up $50k to match the original list price. I'm curious what the experts here think.
We had one neighbor who thought that, because properties over $600k were selling in a slow market, he could sell his by listing it over that threshold. After finding otherwise, the price got dropped by $100k. Then it finally sold.
Your prospective house's present owner may be ambivalent about selling and only the enticement of more cash than it is worth would push him off the post.
in my short time in looking for a home i have learned there often can be no rhyme or reason for what a seller has done. If i have a question i will usually ask my realtor to inquire. But if a seller feels its worth more and raises the price, so be it. Either way i am going to offer what i feel is right for the property regardless of what they have done. I actually like these tricky ones because i think it scares/confuses folks off which might allow me to come in and lowball or avoid a bidding ware.
Seller's perogative. They might have decided they will not be able to buy a decent replacement home unless they get more money. So, they'll stay put if it doesn't bring their price.
in my short time in looking for a home i have learned there often can be no rhyme or reason for what a seller has done. If i have a question i will usually ask my realtor to inquire. But if a seller feels its worth more and raises the price, so be it. Either way i am going to offer what i feel is right for the property regardless of what they have done. I actually like these tricky ones because i think it scares/confuses folks off which might allow me to come in and lowball or avoid a bidding ware.
We've never actually seen the house and it isn't exactly what we are looking for but we figured that maybe if it was still on the market in the late fall and if after viewing it that it would work for us that we would think about making a "market" offer for it. However, now that the sellers have raised the price to well above FMV, they're obviously not interested in offers that reflect the actual FMV of the property so we would probably just be wasting our time.
Not entirely sure I feel comfortable posting the link since it isn't my house and I don't know who the owners are.
understandable.
my guess (based on some of the crazy threads posted here) is it might be an estate sale with a number of heirs adding their input to the sales strategy
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