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If the seller listens to the actual sales data and not the active listings and still wants to set the price too high, I explain the fact that is someone was to overpay for the property, it would not appraise and the loan would be denied. If they don't get that, I recommend an appraisal. In the end, the seller sets the price. However, my job is to sell homes, not to list them. If I can't sell it, I walk away. There is no point working with a seller that is off the market price by a significant amount. The agent ends up with a lot of work for nothing. The seller ends up frustrated and angry that you couldn't sell the house. It costs a lot of money and time to market a listing. Agents put in there own money and time to market a property. The brokerage also incurs fees for listings. They only recover if the listing sells.
If there are no showings at all within 3 weeks, the market is telling you the price is way too high and that people don't want to waste there time with the listing.
Then if they have 12 showings and not one offer, they must lower the price.
Chasing a down market is frustrating for all, takes a long time to sell and no one is happy in the end. By the time your customer drops the price in a declining market, they are still off the mark.
It all goes to seller motivation. If the seller is motivated to sell, they will declutter, prepare the house for a sale by making all repairs, freshning up the house, if needed, and set the price at the market price so solicite a sale. If the seller is not willing to do what it takes to sell in the current market (and there is always a current market), then why waste your time and money trying to sell a house that is overpriced for the condition and market? It makes no sense why Realtors do that but yet in my market, far too many homes are overpriced.
I just looked at properties in a particular depressed condo development. The average price is $54 a SF and there are two listings at $135 a SF (Square Foot). That just makes no sense to me. But agents run their own businesses and are free to run it their way just as sellers can put a high price on a listing if they find an agent to do it or use the MLS only type services.
It's just one of millions of unsellable properties on the market, right now.
You did not mention the seller's motivation. What happens if he does not sell? Where will he go, once sold? What's the debt on the property? Is he upside down on the mortgage?
What's it costing him to keep the property.? Does he have a mortgage? What are the property taxes? HOA Fees? Insurance? Landscape/ongoing maintenance?
The job of a listing agent is to educate, market and negotiate.
Sounds like this guy needs education. Listing agents do not sell property. The listing agent however, is the reason it sells or not. While sellers may ask anything they want for a property, they do not determine value. Asking more does not mean getting more.
I do not mean to be snarky here.....it does not sound like you know your own market or at least this end of the market. Relying solely on dated appraisals and property tax assessments is not good business. An appraisal is one person's opinion at the time the appraisal was executed. Appraisers rarely have the opportunity to know the comps. Do you know the comps? Have you been inside all the recently closed and active/remotely comparable properties?
What's going on in your market, right now? Are you in a depreciating market? Does your seller understand the consequences of chasing a down market?
One of the greatest benefits of our business is that we get to choose who with work with. Why work with unreasonable and potentially unmotivated people?
You might want to explain how important it is to be priced at market value and that you're concerned the appraisal no longer reflects market value. Offer that you'll pay for a new appraisal by the appraiser of his choice and that you'll credit the cost to him from your commission at closing if he prices the home at the appraised value.
It's just one of millions of unsellable properties on the market, right now.
You did not mention the seller's motivation. What happens if he does not sell? Where will he go, once sold? What's the debt on the property? Is he upside down on the mortgage?
What's it costing him to keep the property.? Does he have a mortgage? What are the property taxes? HOA Fees? Insurance? Landscape/ongoing maintenance?
The job of a listing agent is to educate, market and negotiate.
Sounds like this guy needs education. Listing agents do not sell property. The listing agent however, is the reason it sells or not. While sellers may ask anything they want for a property, they do not determine value. Asking more does not mean getting more.
I do not mean to be snarky here.....it does not sound like you know your own market or at least this end of the market. Relying solely on dated appraisals and property tax assessments is not good business. An appraisal is one person's opinion at the time the appraisal was executed. Appraisers rarely have the opportunity to know the comps. Do you know the comps? Have you been inside all the recently closed and active/remotely comparable properties?
What's going on in your market, right now? Are you in a depreciating market? Does your seller understand the consequences of chasing a down market?
One of the greatest benefits of our business is that we get to choose who with work with. Why work with unreasonable and potentially unmotivated people?
I like that word, "Snarky"!
You make some great points, and you are on to something, but I need to explain...
This listing was handed down to me by my manager because it needed tlc.. I did not list it, the pricing was already done. And I think that the manager had put it on at this price to please the owner with the hope the owner would eventually reduce.
I am excellent with clients, and detail, and I also love this type of property, so it came to me.
Here's where I was an idiot: At the beginning of this, I asked where the listing price had come from, and I was told that an appraisal was done last fall. So I went with that for a while.
Then I downloaded my comps onto my excel spreadsheet and ran the averages in this market, and then I saw how overpriced we are according to today's comps (not that we have too many here).
The other issue with this, that was a concealing factor, is that this property is almost all land, and a huge piece of land, in a very expensive part of the state, and there are not many like it left... So that part has been keeping me away from comping it against normal homes with normal acerage... This thing is a monster!
But the numbers speak for themselves, and I tried to get some comps in the winter when I picked this up, and there literally were none. Now there are. And I feel now, that even though this property is different, that the averages still must apply... does everyone else agree, or is this a different issue I need to look at?
I just feel bad because I should never have listened to the bit about the recent appraisal. But, it has not been that long, and I haven't lost too much yet.
Is anyone else getting as sick as I am of all the practice we are gettting now, but not actually making any money at it?
I know, keep positive...
Question is... can the property appraise now for anyone that is going to finance? If not, then what is the point?
Could not be said better. It is sad when sellers think that their house is worth more than it actually is. What Palmcoasting stated is the method of "attack" so to speak that I take in these situations. I tell them that if we could get that high price (would have to be VERY lucky), there is no way it is going to appraise. If they want to stay at that high price, 9 times out of 10 I walk away from the listing appointment because I usually just end up wasting money on something that I know will never sell.
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