“If 35 to 40 potential buyers have toured your home without making an offer, it’s time to seriously think about adjusting the price,” advises New York City real estate agent Brad Malow. In other words, consider a price reduction.
It is Rare to Undervalue a Home
When contemplating a price cut, remember that the market often makes that decision for you.
“It’s nearly impossible to underprice a home, as the market will typically drive the price back up,” says Mike King, an agent with the Partners Trust Realty in Brentwood, CA.
Consider it like eBay: you might list an item for $1, knowing it is worth around $250. Over time, bidding can push the price to $275 or more. It is more advantageous to slightly underprice your home rather than overprice it; this strategy attracts more offers, creating a competitive atmosphere.
“It’s about leveraging power,” explains King. “If I’m a motivated buyer and there are only three offers, I won’t be as aggressive as if there were ten.”
In real estate, if your home has been on the market for an extended period without serious interest, it may be wise to consider lowering the listing price. Some experts recommend making a price adjustment within two weeks of listing, especially if inventory is limited, while others suggest waiting two to four weeks.
Signs It May Be Time to Lower Your Price:
- Few Showings: If your home has not been shown much, a price reduction may be necessary.
- Negative Feedback: If buyers are consistently providing unfavorable feedback, it is time to rethink the price.
- No Offers: A lack of offers after a reasonable time could indicate the need for a price adjustment.
- Online Views but No Offers: High online viewership without offers may suggest that the price is too high.
- Open House Attendance Without Results: Good attendance at open houses but no offers could mean it is time to lower the price.
When considering a price reduction, look at your local housing market. Evaluate the average number of days homes stay on the market in your area and consider getting a comparative market analysis (CMA) to understand recent sales of comparable properties.
Assess your market conditions. There’s no one-size-fits-all timeline for price adjustments, but Malow emphasizes three key points to consider:
- How are comparable properties performing? Are they selling quickly or lingering? What were their closing prices?
- What is the average market time for homes in your neighborhood? If your home has not reached that duration, it may be too soon to reduce the price. Conversely, if you are beyond that time, it might be time to lower your price or even consider delisting.
- How many homes in your area have had price reductions, and what was the outcome? Did those reductions help sell the properties, and what were the final sale prices?
Source: Realtor.com
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