Home Buying in Washington>Question Details

Dee Brown, Home Buyer in Washington, DC

When do sellers typically lower asking prices?

Asked by Dee Brown, Washington, DC Sat Feb 9, 2013

I've seen several homes that have been on the market for 30, 70 and even 170 days at the same listing price. When do sellers typically lower prices? I was under the impression that prices were usually lowered by 8% after one month. What's the cause of the stony prices? Is it ambition? All of the afore-mentioned homes are renovated, but they're also priced at least 20% above the other homes' dollar/sqft in the neighborhood. What's the deal?

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9
Lanre Folayan’s answer
Just because a house hasnt sold doesnt necessarily mean the price. Though Price is the main reasons why many houses dont sell,its not the only reason. It can be due to lack of PRESENTATION-Home staging and PROMOTION-Marketing
0 votes Thank Flag Link Sat Feb 9, 2013
Sometimes the sellers are just waiting for an offer. Sometimes they owe a lot of money and can't afford to sell for less than the asking price even if it's above market value. Sometimes they just have an unrealistic idea of their home's worth. Sometimes there is more than one decision maker and they can't agree. There are a lot of reasons why a seller doesn't reduce the price. If you have a good agent working for you, you can often negotiate a good deal on an overpriced home.
1 vote Thank Flag Link Sat Feb 9, 2013
When they finally realize that the LISTING price was too high!
0 votes Thank Flag Link Wed Feb 20, 2013
Hi D Brown of DC,
Are you looking at new construction or a resale property?
You ask: " What's the deal?"
Answer: There is no deal because you're not making an offer that the listing agent can work with.
You represent the market so it's incumbent on you to make an offer of what the property is worth to you. The seller can accept, reject or negotiate your offer. Any competent realtor can help you do that.

I've been following your queries and it seems that you are focused on a particular house or neighborhood-- and the sellers know it. They're waiting for you to step up and make an offer.

Because you ask questions that a competent realtor would not let arise, it also seems you're not being represented by a realtor. Are you aware that the services of a realtor are FREE to you as the buyer? Are you aware that the seller is already under contract to pay the listing agent the full commission regardless of whether or not you have a buyer's agent?

It would help all of us realtors to do a better job if we understood why you choose to go at it alone instead of working through a realtor that can help you get the home you want at a price you're comfortable with. Please let us know. Reciprocity in the exchange of information helps everyone involved.
thank you
Santiago Testa
202-552 5624
testa@testarealestate.net
0 votes Thank Flag Link Wed Feb 20, 2013
Hi Dbrown


Each seller is different.

Typically sellers are reluctant to lower their asking price after renovation and cost. It is not uncommon for a seller to believe that they have the best product on the market after a costly renovation and some large sums money spent. They may be looking ROI too high.

Good luck
0 votes Thank Flag Link Tue Feb 19, 2013
Sellers often feel that their house is worth more than others. Additionally they may have bought at a high price and they HAVE to get the list price or very close to it in order to sell it. Again price per square foot is not a metric in the DC metro area market.
Santiago
202 552 5624
testa@tesarealestate.net
0 votes Thank Flag Link Sun Feb 10, 2013
Hi dbbrown generally prices lower according to sellers requested increments. remodeled homes have an added price to cover new installations
0 votes Thank Flag Link Sun Feb 10, 2013
Banks use a formula on foreclosed properties where they typically hold out for their asking price for 30 days and then will look at lower offers. Some agents use the 30 days/30 showings approach to demonstrate to their client that the market is speaking and price should be addressed, or whatever objection the agent is hearing from buyers. The decision is always the seller's.

Next question then is who is the seller? Someone still emotionally connected to the property and not really willing to sell, an investor who knows his bottom line and knows there is a buyer for what he has, an institution (bank, court, etc.) also protecting a bottom line, or "motivated" seller (transfer, estate sale, tired of owning)?

Real estate is a combination of straight line financial transaction with an emotional chaser, done right, but sometimes the reverse. There is no formula for when or how much a seller needs to reduce his/her property. You can't tell from days on market how many offers have come in and been refused or fallen out. Or, if it's a couple or business partners, how much agreement there is on a strategy. Heirs can take a long time deciding or be quick.

Are you comparing apples to apples? Condition is a huge part of pricing, it's not just square feet.
0 votes Thank Flag Link Sat Feb 9, 2013
There are many reasons why a seller might not lower the asking price. One reason may be that the seller purchased at the height of the market a few years ago and wants to at least break even when selling or try to loose as little money as possible when they go to settlement.

Another reason might be that the property was purchased by an investor, renovated and then put back on the market. The investor might have a number in mind they would like to take away from the property, is hoping to get that amount and is willing to wait.

A third reason might be that the property is a short sale or owned by the bank and the price is dictated by what the bank wants.

Another reason could be the seller is not very motivated to sell or has unreasonable expectations.

Michelle Buckman
0 votes Thank Flag Link Sat Feb 9, 2013
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