Something has gone haywire. You put your home on the market over three months ago and you haven't yet received an offer. You thought you did everything right. You listened to your agent by following his advice on pricing, completing a few home improvement projects, and even allowing him to show the home on short notice. Still nothing - it's all quiet on the home selling front.
When you hire a real estate professional, even a seasoned agent, it's natural to assume that the counsel and advice you receive from these market experts should always lead to the immediate sale of your home. But often this isn't the case. Why? Because the pool of real estate buyers available in any given market determines the salability of a home, not agents, insurance agents, mortgage brokers, title companies, or even homeowners. Homebuyers can be a fickle group who can turn on a dime, moving towards or away from pricing categories, home styles, niche markets, and even whole neighborhoods at the drop of a hat. This is exactly why it's so easy to make a mistake when positioning a home for sale, and why it's critically important to adjust your strategy when necessary.
To stay vigilant let's take a look at five red flags to watch for:
On average a home buyer will look at 10-15 homes before making a buying decision. If you are receiving few or no showings as the weeks roll by this should be a clear indication that buyers are rejecting the price of your home. Sure they may see your listing in real estate magazines, the newspaper, or the internet, but as quickly as they are exposed to your home they reject it. Why? It's overpriced and the only solution is to adjust the price.
If buyers are viewing your home regularly yet you receive no offers, this can be a red flag that buyers aren't rejecting the price but the home itself. This is a classic condition issue challenge which has one of two solutions. The first is to interview buyers or their agents to discover their objections to your home and then immediately fix those issues. If you are unwilling or unable to do this, the only other option is to adjust the price to compensate for the cost of fixing problems after the buyer takes possession. This technique is often referred to as providing an allowance.
If you have received one or more low-ball offers, this can be a red flag that buyers don't perceive the same level of value in your home as you and your agent. To help overcome this obstacle you may wish to allow your agent to release the competitive market analysis, or formal appraisal that was used to price the home to potential buyers. In addition, provide buyers with a list of improvements you have made to the home, as well as other value points that would be important for them to know before making an offer. In the end you may still need to make either pricing or condition adjustments, but at least you will have made an effort to build value in the buyers' eyes.
In most cases a cooperating agent will be the one who brings a buyer to your home. But if agents perceive that there is a challenge with your listing - something that they believe will turn buyers off - it's a good bet that they won't want to waste their time showing your listing. To deal with this challenge many sellers ask their listing agent to conduct a tour of the home with cooperating agents. They invite these agents to fill out comment cards with their opinions on price, condition, and overall salability. To increase the odds agents will unleash their gentle brutality on your home, make sure the comments cards remain anonymous.
The real estate market is changing rapidly. For instance, home owners who put their home on the market last week and, at that moment had the best buy on the block can easily find themselves overpriced the following week when all of their neighbors reduce their prices. To stay ahead of the market curve you must be aware of your competition. Ask your agent for regular updates on every home you are competing with for a buyer's attention. Pay close attention to pricing and condition changes, pending and closed sales, as well as new listings, which may impact your price and position in the market.
To sell your home requires that your home is exposed to every ready, willing, and able buyer in the market place, and that your home offers those same buyers the best value for dollar spent. In other words, exposure by itself isn't enough. No amount of advertising or marketing will force a buyer to buy an overpriced listing or a home in inferior condition compared to the competition. It's tough but true. Successful sellers embrace change and aren't afraid to adapt to the market or to buyers' needs.