Home Selling in 18902>Question Details

lchutton, Home Seller in 18610

How much to lower the price?

Asked by lchutton, 18610 Thu Apr 12, 2012

My vacation home has been on the market for a year with only 4 showings. It is part of a community that has 6 or 7 comparable units for sale - priced from $230,000 to $279,000. The last one to sell was 4 or 5 years ago at $299,000. It was foreclosed upon in early 2012 and the bank accepted $148,000 cash. When I put my unit on the market, I started at the lowest price of the similar units even though my unit is furnished and includes an extra BR and Hot Tub. When I bought the unit in 1990 I paid $170,000 and enjoyed it for 20 years while the kids and cousins were growing up. Now that everyone is gone, we do not use more than a couple of weekends a year. Renting it would net about $9,000 yearly. My break-even price is around $200,000. The big problem is payments, dues, taxes & utilities run about $26,000 a year with only about $10,000 going toward equity. That's $16,000 per year with nothing in return. How much lower should I go?

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Answers

4
Depends on your motivation and your bank account. At a certain price someone WILL buy it.
0 votes Thank Flag Link Fri Jul 27, 2012
That's always a good question.

I am not a Realtor so take my opinion for what its worth. Selling in an uptrend you can set the price higher and wait for the market to catch up to it. In a downtrend you have to aggressively price your house lower to ensure that it gets some action. Let me give you an example. 4 to 5 years ago a house sold for $299,000 and had you set your price at $290,000 you may have sold yours. A year later $275,000 may have got it done and now houses at $230,000 has not sold. The housing market will turn around eventually but nobodycan tell you with an certainty exactly when that will happen. My opinion is that it will take 5 to 7 years for everything to settle and we have most of the distresses properties eliminated from the market. Obviously if you can wait out the downtrend you will be in better shape but it appears as though it is an expensive investment.

First I would see if the kids want to contribute to keeping it going. Thats a win win for everybody. If not price it low and be preapred to drop it 5% per month until somebody bites. It may hurt now but it's better than paying whilst trying to chase the market down for a couple of years.

FYI, I don't look at your house from the perspective of a Realtor, but as an asset than needs to be sold. If you decided that it is non performing, cut it loose and it will save you money in the long run.

Alan
0 votes Thank Flag Link Fri Apr 13, 2012
Lcutton,

As Terry stated, you'll know when you hit the "magic" price - when you start getting more showings. What was the feedback from the 4 showings you did have? Was the feedback only negative on price or were there other things the potential buyers said? Sit down with your Realtor and have an open, honest discussion. Then you'll need to decide whether you want to continue paying $16,000 per year until you can get the price you want. It might even be better to take a loss of a few thousand dollars now than to continue paying the payments, dues, taxes and utilities.
0 votes Thank Flag Link Thu Apr 12, 2012
You need to keep lowering the price until it sells. It will reach a certain number and you will start to get more showings and finally an offer. Ask your agent how low you should go but in this market price is everything.
I wish I had better news. Good luck with your sale.

Terry Lohrbeer/Realtor
Long and Foster Real Estate
267-446-3530
0 votes Thank Flag Link Thu Apr 12, 2012
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