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We are trying to sell our house in a pretty good seller's market. Our realtor showed us comps on homes that sold recently so we set our price at what we thought was reasonable. We are not in a market where homes get tons of offers on the first day but most sell within a week or two.
However, after doing a lot of research online (and going to open houses) there are one or two giant realtor companies that seem to be lately underpricing properties in our neighborhood which were all built around the same time and don't vary that much with square footage or amenities. These homes will be listed at least 25k lower than the price they "should" sell for, and go under contract in a day or two for somewhat more. In fact, a few homes didn't even hit the major shopping sites like zillow before going under contract (which makes me think that was an in-house sale). For example, a house that "should" sell for 375k or even more will hit at 340k and go under contract for 360k. I know one seller personally who was very excited that his house sold in a day, but his house was so nice that I know he could have gotten significantly more had it been on the market a few days and had time for more buyers to see it. Sellers trust their agents to price their properties and unless they dig deep have no clue they could have done better. To a seller 15k more is a lot but to their agent who earns 3% that's only an extra $450. I have a feeling these realtors are more interested in volume than getting the best price for their sellers. And maybe they want to clear out as many houses as they can before the prime summer months are over.
We left our house on the market at the reasonable price and sold it at asking in two weeks. But now I am afraid the slew of underpriced homes are going to hurt our appraisal. Has anyone else seen this trend?
It's well known agent and seller incentives are not aligned. Agents are incentivized to sell as fast as possible; sellers are usually willing to wait a little longer for slightly more money.
This isn't a knock on agents, it's just one thing to be aware of if your agent tries to push a sale before the house even really lists. In a really hot market I've heard of purposely under-pricing to spur a bidding war, but that's a different beast (and probably a case where the agent and seller have more aligned interests).
As to values, it may make appraisals slightly lower, I suspect it's too much in the noise to say anything definitive.
We are trying to sell our house in a pretty good seller's market. Our realtor showed us comps on homes that sold recently so we set our price at what we thought was reasonable. We are not in a market where homes get tons of offers on the first day but most sell within a week or two.
However, after doing a lot of research online (and going to open houses) there are one or two giant realtor companies that seem to be lately underpricing properties in our neighborhood which were all built around the same time and don't vary that much with square footage or amenities. These homes will be listed at least 25k lower than the price they "should" sell for, and go under contract in a day or two for somewhat more. In fact, a few homes didn't even hit the major shopping sites like zillow before going under contract (which makes me think that was an in-house sale). For example, a house that "should" sell for 375k or even more will hit at 340k and go under contract for 360k. I know one seller personally who was very excited that his house sold in a day, but his house was so nice that I know he could have gotten significantly more had it been on the market a few days and had time for more buyers to see it. Sellers trust their agents to price their properties and unless they dig deep have no clue they could have done better. To a seller 15k more is a lot but to their agent who earns 3% that's only an extra $450. I have a feeling these realtors are more interested in volume than getting the best price for their sellers. And maybe they want to clear out as many houses as they can before the prime summer months are over.
We left our house on the market at the reasonable price and sold it at asking in two weeks. But now I am afraid the slew of underpriced homes are going to hurt our appraisal. Has anyone else seen this trend?
The bottom line is a commission sales person does not get paid until the sale is made.
There are a lot of rookie agents entering the real estate market and if you are seeing an underpricing trend from two large companies, what I think you are seeing is rookies pricing listings without supervision. Large companies tend to train most of the rookie agents and some supervise well and others not so much.
I know it is making my job harder here to have to constantly correct and help the unsupervised rookies that are out in force in my market.
We are trying to sell our house in a pretty good seller's market. Our realtor showed us comps on homes that sold recently so we set our price at what we thought was reasonable. We are not in a market where homes get tons of offers on the first day but most sell within a week or two.
However, after doing a lot of research online (and going to open houses) there are one or two giant realtor companies that seem to be lately underpricing properties in our neighborhood which were all built around the same time and don't vary that much with square footage or amenities. These homes will be listed at least 25k lower than the price they "should" sell for, and go under contract in a day or two for somewhat more. In fact, a few homes didn't even hit the major shopping sites like zillow before going under contract (which makes me think that was an in-house sale). For example, a house that "should" sell for 375k or even more will hit at 340k and go under contract for 360k. I know one seller personally who was very excited that his house sold in a day, but his house was so nice that I know he could have gotten significantly more had it been on the market a few days and had time for more buyers to see it. Sellers trust their agents to price their properties and unless they dig deep have no clue they could have done better. To a seller 15k more is a lot but to their agent who earns 3% that's only an extra $450. I have a feeling these realtors are more interested in volume than getting the best price for their sellers. And maybe they want to clear out as many houses as they can before the prime summer months are over.
We left our house on the market at the reasonable price and sold it at asking in two weeks. But now I am afraid the slew of underpriced homes are going to hurt our appraisal. Has anyone else seen this trend?
Im not sure how you think a house "should" sell for $375, when it ultimately sells for $360. If it was listed at $340, there was obviously a bidding war going on, so didnt it ultimately sell for what the market said it was worth?
Theres dozens of threads here where real estate agents priced a house for a seller, stating it it where it should be listed at...and then it sits and sits and they have to lower and lower and lower the price.
Seems to me there is a LOT to be said for putting a house on the market, and having it sold in a day or two. Lots of sellers here would love being in that position, even if it meant leaving a little on the table.
In the end it's up top you to set the price. The only obstacle is if you price ridiculously high the RE agent should tell you he's not interested in listing it for you.
No, appraisals are based on the perceived value that the home has according to it's condition and to other recent comps in the area.
Huh??
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