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Old 04-01-2021, 04:21 PM
 
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I am just curious, seeing as home sellers are getting bids way over their asking prices, why do the real estate agents not suggest a higher asking price? Especially if the home owner doesn't need to sell in a hurry.
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Old 04-01-2021, 04:44 PM
 
Location: planet earth
8,620 posts, read 5,620,113 times
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Because people look at a certain demographic, one, and two, if you raise the price above the current market (which changes daily), you won't get showings.

The best strategy in a seller's market is to price the house a little under market value and hope for multiple offers (which could drive the price up).

It's supply and demand and you have to price accordingly.
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Old 04-01-2021, 05:00 PM
 
Location: DFW
40,936 posts, read 49,025,568 times
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I price it a little over where comps show it should be priced and we are still getting offers over that.

Forget appraisals.
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Old 04-01-2021, 05:03 PM
 
21,830 posts, read 9,386,613 times
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Quote:
Originally Posted by nobodysbusiness View Post
Because people look at a certain demographic, one, and two, if you raise the price above the current market (which changes daily), you won't get showings.

The best strategy in a seller's market is to price the house a little under market value and hope for multiple offers (which could drive the price up).

It's supply and demand and you have to price accordingly.
This.

People love these bidding wars. Especially sellers.
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Old 04-01-2021, 05:04 PM
 
Location: NC
9,353 posts, read 14,010,665 times
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Yes, apparently the seller loves those bidding wars. That way they get lots of concessions too. Like ignoring inspections, getting rent back periods, selling as is, no contingencies, high due diligence payments (in NC), high earnest money provisions, etc.

Meanwhile ordinary buyers are having a hard time even knowing what to offer.
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Old 04-01-2021, 05:08 PM
 
Location: planet earth
8,620 posts, read 5,620,113 times
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Quote:
Originally Posted by luv4horses View Post
Yes, apparently the seller loves those bidding wars. That way they get lots of concessions too. Like ignoring inspections, getting rent back periods, selling as is, no contingencies, high due diligence payments (in NC), high earnest money provisions, etc.

Meanwhile ordinary buyers are having a hard time even knowing what to offer.
It's not personal. It's capitalism.

That's the way the market works.

If you don't like it, don't participate.
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Old 04-01-2021, 08:24 PM
 
Location: Berkeley Neighborhood, Denver, CO USA
17,692 posts, read 29,691,842 times
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Quote:
Originally Posted by nobodysbusiness View Post
It's capitalism. That's the way the market works.
It is not capitalism, but it is a market economy.
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Old 04-02-2021, 04:55 AM
 
Location: Redwood Shores, CA
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I have been a seller a few times. My thoughts:

1. I have a theory, that agents always want the seller to price lowest possible, and the buyer to bid highest possible. Logically that way the chance of a deal is highest. (I don't know if true or not; maybe someone can educate me.)

2. As a seller, unless I am in a hurry to sell, I rather price it high and wait for someone who truly likes the property to give me top dollars. This way I am guaranteed the amount I want if there is a sell. To me, having the house sit on the market for 3 months is perfectly OK and is a good timeframe to flush out the one willing to pay the top dollar.

3. Leaving the price to a "bidding war" is to assume market is 100% efficient; I think that is risky.
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Old 04-02-2021, 05:59 AM
Status: "Made the Retirement Run in under 12 parsecs!!!" (set 22 days ago)
 
Location: Cary, NC
43,176 posts, read 76,815,786 times
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Quote:
Originally Posted by RobertFisher View Post
I have been a seller a few times. My thoughts:

1. I have a theory, that agents always want the seller to price lowest possible, and the buyer to bid highest possible. Logically that way the chance of a deal is highest. (I don't know if true or not; maybe someone can educate me.)
There may be agents who work that way, but future clients want assurances that I get the best price possible for my sellers.


Quote:
Originally Posted by RobertFisher View Post
2. As a seller, unless I am in a hurry to sell, I rather price it high and wait for someone who truly likes the property to give me top dollars. This way I am guaranteed the amount I want if there is a sell. To me, having the house sit on the market for 3 months is perfectly OK and is a good timeframe to flush out the one willing to pay the top dollar.
We have a lot of local data, over years, that indicates clearly that "price reduction listings" sell for less than comparables that are reasonably priced to begin with.
Consumers buy houses like bread. Fresh listings are better than stale listings. Long time on market connotes problems and seller issues to a great many buyers, particularly in hot sellers' markets.

Quote:
Originally Posted by RobertFisher View Post
3. Leaving the price to a "bidding war" is to assume market is 100% efficient; I think that is risky.
It IS risky in many markets to purposely list at low prices to attract traffic. Wasteful, too, at this point.
Trying to price up to what multiple offers may yield is equally risky, IMO.
I tell my sellers, "The buyer pool will set the price. All we need to do, is not do anything stupid." I.e., price so high it turns people away.
That is very accurate in my overheated local market, and I think in many others.
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Old 04-02-2021, 07:17 AM
 
867 posts, read 2,102,532 times
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The risk with listing house prices too high is that they don't appraise even if you get a full priced bid. Then, the seller is faced with either lowering the agreed price to match the appraisal, or having to go back on market with a now "stale" house and an appraisal that attaches anyway. If you price at market, and offers come in above, there are some desperate buyers in this market who will offer to cover a portion or all of an appraisal shortfall, or you have someone who doesn't have a financing/appraisal contingency at all.
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