Home Buying in 18229>Question Details

Lulu, Home Owner in Horsham, PA

Should be lower home price to our actual bottom line?

Asked by Lulu, Horsham, PA Fri Aug 10, 2012

Our vacation home has been on the market for a year. We had it priced too high. It is only about 5 years old and in great condition, but it is small - we don't think so, but potential buyers do. It is the only complaint. I believe it is priced right now, but the truth is that our bottom line is ten thousand less than the list price. I want to lower the price. My spouse thinks this is a bad idea, because buyers will come in low, as usual, but we will not be willing to negotiate because we are at the bottom. Any thoughts? We did have a buyer at the price I want for the home, but financing fell through.

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Lower your price to expand your pool of potential buyers. You can work hard to get your price once you get an offer. Many buyers won't even look at a property that is over priced.
0 votes Thank Flag Link Fri Aug 10, 2012
Understand that the LISTING PRICE has one primary objective, to attract attention: It is not intended to be set in stone, and in many cases it is not even a good guideline toward the SELLING PRICE.

Some Sellers believe that by setting the LISTING PRICE high, they can always come down, and people will make an offer anyway: WRONG! Buyers will just bypass the property and look at houses that are within their price range. And six months from now, the Seller will slowly start lowering the PRICE, (this is called “chasing the curve”) and Buyers will be asking the question; “What’s wrong with that house?” and “Why has it been on the Market so long?”

Other Sellers set the LISTING PRICE low, to attract multiple offers. (The correct strategy.) We are asked; “Aren’t you obligated to sell at this price if someone offers it?” The answer is probably not; for that to happen, you would first have to have only one offer, and secondly, the offer would have be exactly the same, down to the smallest detail, (please discuss this with your Realtor).
Another thought; Buyer will search for potential properties by groups; for example, $400,000 to $450,000, and $250,000 to $300,000. If your house is priced at $460,000 or $310,000, the Buyers will never see it. (something else to discuss with your Agent.)

Different Banks have different philosophies about pricing their properties: You cannot draw any conclusions without a good analysis.

Have your Realtor do a CMA, (Comparative Market Analysis) to help you determine your Offering Price. It is the surest way to determine the Market Value of the property.
0 votes Thank Flag Link Fri Aug 10, 2012
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