Thank you for your detailed response.
My wife and I were in a similar bind many years ago. I was transferred to Portland, OR and we bought a house. It was time to move and we could not sell it for what we paid. It became our first rental property and we held onto it for 18 years, and made a lot when we sold it.
I would break my response down like this:
1. Make sure you are not \blaming the Realtor for the market.
2. If the Realtor is not delivering, and you've spoken with him/her about your concerns, immediately call the broker. The broker legally "has the listing". I would candidly explain your situation and ask for a new agent...you could even ask to speak with two or three Realtors and obtain the broker's assurance that you will receive the attention you deserve and the service you need.
3. Look at your options objectively. I am sorry if I was a little direct, but this is business, not a popularity contest. If you step back and look at your situation, maybe you will find you have more options:
a) You need to sell. Can you afford a loss? Talk with a CPA, look at the tax consequences.
b) You could selll, but not at a loss. Can you rent it out? Time is not on your side. Peak selling season is springtime. If you don't get it sold in the next two weeks, you will have probably missed the summer market.
c) Market it as a LEASE and a SALE. Again, discuss with your CPA, leasing may not be option #1, but it might help. As I mentioned at the beginning of my post, you might become, as we did, accidental landlords.
d) Talk with a trusted friend or advisor about your situation. I sense a lot of stress (which makes complete sense). We don't make wise decisions under stress.
One more option - if you decide you need to sell:
1. Take it off the market for a week.
2. Repaint the front door.
3. Add some inexpensive flowers in the front yard,.
4. Re-shoot the pictures.
5. Price is 5010% below market.
Our broker did that and the home sold for market price with multiple offers in a week. I also strongly suggest asking the broker to refer you to a lender that might be able to help your Realtor pre-qualify buyers so you don't end up wasting valuable time with unqualified buyers.
Let us know what happens.
I hope this is helpful.
I have to say that you are counting on appreciated value from the spring of 2005 which for many parts of the country was the height of the market. If your market has been hit like many other markets the appreciation door slammed shut just as title passed on your home. This is unfortunate, but that doesn't change the reality of the situation. If your market is flat or going down, have you made any significant improvements to the property would justify the home being worth $19,000 more than it was when you bought it? If not, and your market has indeed cooled, you may have no choice but to reduce the price and accept a loss.
Hard as it is to say, what you need in the way of price is not truly relevent. It all boils down to what people are willing to PAY for a home. Buyers are truly not concerned whether or not you will lose money. Their bottom line is all that matters to them. Although NY is doing quite well in spite of the market shift, I can tell you that my buyers have gone from knowing they had no bargaining power to being an exceptionally picky group - even when there isn't much inventory to pick from! We stil have bidding wars, but only on propertiest that are in PRIME condition with all granite countertops, custom wood cabinets and marble baths.
From what I am reading, you have no choice but to move and once you do, you will have carrying costs which could quickly outstrip any benefit from a higher sales price. In fact, you stand to lose more money by standing pat once you have the carrying costs of two homes - even if one is a rental.
As to discount brokerage. It is essential that you know how much the agent for the buyer is getting in your contract. We had one discount company that was only offering less than half the usual commission to the buyers side. The result: the homes weren't shown at all and when they were, the buyer's agent forced the seller to pony up for the remaining commission, lose the buyer or reduce the price to compensate the buyer for paying the agent. If you use a flat fee MLS, you have to be prepared to be willing to pay full commission for the agent on the other side (usually 1/2 the standard full commission) or recognize that few if any agents will show your home. You will also have to pony up for advertising and be prepared to show the house at all times. Buyers will also note that you are "saving money" and want a piece of that action in the form of a price concession. So you stand to save about 1.5% after the MLS fees and advertising which will chew away at that profit. Plus, you add the risk of going it alone and having to formally list again.
If you were to increase the commission rather than drop price you already save $1,000 - $11,000 and it might help to sell faster.... you have to remember you also have to compete with new home builders and what they offer to Real Estate agents to bring buyers in and a lot of them are offering commissions in excess of 6% to that buyers agent.....
I feel for you because you have a tremendous investment in your home.
You might want to circulate a flyer that bullets EVERYTHING that you have done. Then, maybe for a nominal fee you could find a designer who could leave pictures and samples of what the house could be along with some cost estimates. Most people lack "vision" - perhaps by using a designer - you can provide the vision.
You have some pretty good advice so far. Let's see what we are missing.
I am curious to know why you are selling? If you are moving somewhere, when do you need to be there?
In other words, how much time do we have?
You also posted
"Also, you mentioned If I lower price, I need it to come out of something other then my pocket. Right now, based on Trulia, I am priced at $109SF (average is $117). "
And you posted
" I put 30k into my house over the last 2 years for windows, new siding and paint job, landscape, new furnace/ac, sump pump, water heater and overall freshed up place and never expected to get all 30k out.. what I expected was 3% appreciation on what I paid which was 281k.. I am listing for 300k."
" Decent feedback so far, except 1 that said it was overpriced and wasn't going to keep looking in our county. "
Tracey, just like the stockmarket, we don't make the market in real estate. We advise our clients, eduate them, give them the best information we have, and let them make the decision.
Here are the facts:
The amount you paid for your house, the improvements you've made, your anticipated appreciation...chuck those all out the window. They do not matter.
The market is speaking so loudly you are unable to hear it. The one comment you received about you being overpriced was the only accurate feedback you have received, and you are ignoring it.
Based on what you have posted I would say that it sounds as though your philosophy is "If I don't get my price, I am not selling". Is that true?
If it is, then you can list it anyway you want, at any price you like, and it won't sell. No one is going to pay more for a home than it is worth.
Assuming your home is being marketed, and it sounds as if it has been because you've had showings, the National Association of Reatlors seller survey says if you have had more than ten showings, and no offers, the price is too high.
My standard is this:
1. At least ten showings, or two offers, in two - three weeks, or we adjust the price.
2. Showings and no offers, lower the price
3. No showings or offers, lower the price.
Good Luck !
Thank you for your observations.
The improvements made to house were new heat/ac 18SEER pump (worth about 10k), new windows (we have a ton of windows.. we did get a discounted price because we are friends with someone that does windows but it would of costed 10-12k, we paid 8k ). We put new carpeting in DR, new sump pump, water heater and had radon tested and abated (it was a part of a warranty so we're out nothing -- but I like the peace of mind factor). We also found last November (on our yearly inspection) a tiny bit of termite activity near our porch so we had the house treated and have a warranty to pass along. We also just replaced the fridge and stove a few months ago so the kitchen looks really nice. I had wanted to re-do cabinets/countertops but we ran out of time... what we have does look updated (countertops are only 2 years old) vs some of our competition but it's not the designer kitchen I'd want to put in if we were staying a little longer.
Hope that helps. Again, Cincy's run up has still only been 3% per year.. even in the hot market.. it wasn't nutty. We probably should of stuck to our guns when we bought.. (we offered then 275k, they countered at 281k so we took it.... they were asking 299k). Bottomline I would of purchased back then for $299 if the mechanics had been updated...
So to net out.. we put in about 30k and a lot of sweat equity (painting, flooring etc) and I only hoped to get at best 15-20k back.. since we added the curb appeal back to the house..
I guess one could say someone can move in and enjoy cheap heating/cooling and know all big ticket items have been replaced. We also put down new flooring in our laundry room (which doubles as a hobby room/mud room). We also added to the professional landscaping so it looks nice.
We did other things that are small like we've staged the home. We freshened up the paint. I guess from huge projects, we never did what we wanted to do to move our house to the 340k price range.
The only other thing I know that was huge is we replaced the cedar siding and changed the color. The original color was disgusting and I can't tell you how every neighbor has complimented us on the choice (this was done last year).
So while our fixer uppers weren't in line with making it fancy.
But if your home was priced right to begin with, you have to wait and pray for your first offer. (Not that you shouldn't be doing nothing, just that you can't force someone to buy your house.) If it's a low ball offer, it 's probably because that is what your house is really worth. But it might be a full price offer or two groups see it at the same time and you get a bidding war. As for the other houses, your competition, go to those open houses and really see. Look at houses priced at $250,000 and $350,000 to see the differences.
Put the MAXIMUM number of EYEBALLS on the house for sale.
What is your listing agent's marketing program ? A lot of good points have been made in this forum but going back over the comments, I could not find much that was said about the agent's marketing program.
Let's review the program and see if we can spot something that is missing. It's a bit difficult to offer suggestions when we are so removed from your local market.
Good Luck !
I've done drive by's of a few others and I honestly.. wouldn't want to live in the other neighborhoods just because the house might be nice but there is a huge apartment complex 1 block away and truly unkept inexpensive housing (like 115k range) as your entry point to the subdivision.
My house does have one entrance that has lower priced homes (150k to 275k) but they are all neatly kept up to the point I am getting ideas of landscaping from the cheaper homes down the street.
The other entrance to my neighborhood are 750k+ custom homes (I can walk to the last few lots being built in less then 5 minutes).... I can't compete with these but I am also only priced at 300k.
My concern is something is wrong with my house with the lack of traffic but I bought the house for 281k in May 05' and I think the purchase before us was 273k in Nov 04 (the owners got a job transfer and had updated some things when we bought it) and before that was like 2000 with purchase price of like 220k.. so to the folks saying lower.. lower to what??? we don't have anywhere to go really. There are houses of similar size and ammenities going for 175k-225k, but they aren't in my subdivision. If someone wants a slightly unique (meaning it's not crazy different but it's a custom home ) then they pay a little more for it.
In judging my home vs. the ones slighty more expensive I think I come out a winner.
My gut is telling me to calm down, regroup and stay firm on price of 300k until I have an offer. Once we lower price we're done with negotiations.. we won't have any room.
Thanks for everyone's thoughts and advice. I know there is as happy ending somewhere.
Lastly, I think one possible reason for finding that a price redeuction has not necessarily correlated with an immediate sale in your area might be that the reduction is not substantial enough. If a home is significantly overpriced (50-100k), and the big move on price is a $10,000 reduction, it's no surprise when the home still doesn't sell. Further, once a home has been offered at an overly inflated price, it is not enough to bring it back down to where it should have been priced at the outset. It no longer has the initial buzz that comes with a new listing, and it will grow stagnant. To regain attention, the price change will have to be significant. I'm sure that every seller on earth is tired of agents breaking out the trite graphs showing the consequences of overpricing, but the data doesn't lie.
I'll wrap up by saying that not being familiar with your local market, I have absolutely no idea whether your difficulties are price related. That said, and as difficult as it is to bite the bullet, a great price tends to make a lot of other issues go away.
"I have been inside many of the homes that have sold or are under contract. The house has been at the current price for two weeks and only one showing. Prior to that, we got only one showing at each of our 3 different prices.
All REALTORS and home owner:
I pulled up stats on sold and under contract homes (in my market), and only ONE home out of 13 homes sold as the result of a price change. I no longer have access to that same information but of the 21 homes that are currently under contract, one home has a market time from listing to contract of 184 days and all the others average 19 days from new to under contract. The official DOM for the past 6 months is 151 from listing to close.
So, sorry if I disagree with all the age old agent advice of reducing the price. I agree it has to be priced right in the first place and that your first offer is usually your best offer. But "If it hasn't sold, reduce the price" is getting a little old of an answer for me.
I'm sorry, I am stressed and out of answers. I sincerely appreciate everyones advice. It's just that sometimes I think the NAR is brainwashing all of their Realtors."
You have really got conversations going. I haven't read even half of them but I read one of your detailed ones. We are in similar situations. First, if it has only been on the market 2 weeks and your house was priced right in the first place, don't lower the price yet. I did too quickly and it didn't result in anything. After I got out of my agreement with my full service, I switched to a flat rate and dropped the price again. Still no action. I'm now 15% below it's value.
If after 45 days, you have nothing, then switch to the flat fee. Keep looking at the competition and the under contract and solds. Keep asking for advice. But the most important thing is if you get a low ball offer, don't turn it down. Your first offer is almost always your best offer. You can negotiated from that low ball offer, but don't just discount it.
You've received a lot of really good advice.
Here is my comment about buyers agents as it pertains to flat fee MLS. When your property is the perfect match, a buyer agent will contact you regardless of how you are listed. Their motive is to serve their buyer client's interest. If you are the only game in town for that buyer, or the best game in town for that buyer, the buyer agent will show your property.
More often than not.........there are several properties which fit the buyers wants and needs. When a buyer agent needs to choose between 15 or more properties that match buyer's criteria, you want to do everything you can to give your property the advantage and be on the top of the list.
It is often a more difficult transaction, and definitely increased liability for an agent to work with a FSBO or for sale by owner. That may cause a few buyer agents to evaluate other properties first to see if those meet the buyer needs. If 7 other properties have just as good as opportunity of being the right property, and the day is filled with showing those homes, yours may get left out.
Agents talk about properties and even make recommendations to each other about properties. An agent may have shown a property and tell another agent that they know they are looking for x property, and this one shows nice, is motivated, etc. The less you are shown and the less you are known among the buyer agents, the more advantage you give to the competition (the other properties.)
You might sell as a FSBO or MLS flat fee seller. If you sell based on limited buyer exposure, you wonâ€™t ever know if more market exposure could have brought you a better offer, and what you left on the table.
In response to your question about lowering the price, I didn't mean to suggest that you place yourself in a short sale situation. In fact, it sounds as though you aren't pressed to sell immediately and can opt to wait it out. Reading from other posts, the pending rate is "crappy", and it may dictate that you do wait.
Yes, I do recommend a large price drop after 2 weeks - in my market - or when a seller really must sell their home. It gets noticed and often places the home in a new search bracket attracting a new pool of buyers. Stay in the 25's - people tend to search with those cut-offs, i.e. 275k, 250k, etc.
Finally, I must chime in and remind you that your Realtor is not in control of the market (just imagine if she were?!), and she is as eager as you to get it sold. An unsold listing is a liability on an agents books. Have this discussion with her from the position of teamwork. Because it is. Ask her to provide some hard data so the two of you can revisit your strategy. If she still feels you need to "chill out", then consider that she does this for her bread and butter and has learned to be patient. If you just don't like her at all, then ask her to be released from the contract.
The truth is this, you will probably have far fewer showings if you list with a flat-fee service. No one is conspiring against them, it's just that buyer's agents find themselves having to do twice the work (that of the missing listing agent) and face twice the risk exposure and it's simply not worth the added time and frustration. So, those listings don't get shown - even if the buyer's agent commission is the full amount.
You do sound motivated. It is a shame that the upgrades you provided have left you in a tight position. I wonder if it may indeed be your best long-term interest financially to hold onto the home for another year or two.
I wish you the very best,
I fired my agent last night. I gave the 30 days notice to get out of the contract. The challenge with my agent is probably perception and the fact that I told her what I needed as a client (feedback, calls, advice etc). Thinking back, she never presented us with a CMA. I had several from other agents. I told her upfront we were experienced home sellers.. .I don't think she's an experienced agent. Her company is supposed to be so aggressive but now that I've worked with them, I see that their process to sell.. leaves out room for doing whatever it takes to sell a house.
My husband who never every gets upset, is the one leading this charge. If we pay full service, we expect full service. I really understand the rush to defend my agent, but beleive me.. if I had to stay full service (which we might still do).. I'll go back to my old agent whom I loved.
I am to blame b/c I never should of gone with a different agent to sell my house. It's like trying to fit a square peg in a round hole. My expectations are very high.
Also, if our house doesn't sell in 30 days (while they have the contract still).. then it will be very stressful and price will drop etc. I need to be with an agent (or with a flat fee MLS service aka ourselves) that is going to understand how to work with me during stressful times.
I really wanted to know what Flat fee services were acceptable if I was to go that route. I don't want to get ripped off by some scam artist on line.
I require to get on MLS and the various other sites like WSJ, realtor.com, trulia, etc. I need a lock box and a sign for yard that won't turn off an agent so it would need to not say.. For Sale by Owner (b/c we would certainly pay the 3% if an agent found us a buyer)
I would want to be able to keep the extra 3% if we found out own buyer. The flat fee MLS services I've found are ranging from $499 to $799 and one or two that will do it for $1500 just for MLS and $3500 Flat fee for MLS and a few other features.. trouble is I can't find my own buyer.. I must still use an agent so the contact isn't open.
Yes, the market is tricky. I am going to run the numbers to see if actually taking a loss is good for us at tax time.
The market can be really tricky. Don't be so sure your agent isn't working with you. Sometimes getting ahold of other agents for feedback can be a trying experience. If you really don't think she is doing a good job, ask her broker to replace her. Keith had some very sound information. Have your agent give you the current numbers on like homes in your area. Make sure you are priced lower. Find out if your home is listed on any websites. See if you can find it. Most buyers use the web to find homes even if they are working with an agent.
Keith Soram... Ok.. we're moving because of my job transfer and we aren't buying right away. I want an offer on house by end of August so I am motivated. However, I only have another 10k to play and then I am in trouble. Again.. at this rate, I should not of updated anything and just taken the price off the top b/c at this rate.. my house flows better, updated and buyers want that and the same cost of the crappy homes in the not as nice neighborhoods.
Here are some facts (regardless of outcome right now)...
I am listed with a seller only agent. that agency will get 6% for the full service. I am receiving poor service, in way of communication. The company is very aggressive in many ways and told me my listing price of 300k was solid as of 3 weeks ago.
I do not like my agent, although I am completely being nice and trying my best to get what I need from her. I am in sales myself and very inpatient and aggressive.
She is telling me to chill out it's only been 14 days and give time for the "process" of marketing to kick in.
This is house #4 for me and realize the ins and outs of house selling.. obviously not everything but I have learned a lot over the years.
The other comps I got told me to list my house for 320k and 315k and I wanted to do 300k because I wanted to sell it quickly.
Average days to sell is 66 days. I am ok with that if we can do that. The average price drop I've found is about 1% from Listing price, but that came from an article I read last week in the Business Journal of Cincinnati. I could be mistaken. I wish I could site it for additional feedback.
There are other houses with similar squarefootage but they are not as desirable subdivisions.. I know this because when I bought 2 years ago I had been doing research on neighborhoods for a long time --so I know this area.
We toured 3 homes that my agent thought was our competition. Out of those three, 1 was nicer inside but had the garage in the basement so you have lots of stairs, and was on a very busy street with a not so great neighbor (parked cars on lawn for sale). 1 was price 20k lower then ours but really nasty with very dated cosmetic details, mechanics and .. has been on market for a year. The third one was nice but very cluttered and lacking some of our curb appeal and didn't have the updates. In fact, none of the houses had any of the mechanical updates. I realize you don't get all your money back on that stuff but thought it accounted for something.
I figured with the price of energy, our low energy bills would mean something!
So we're back to price.
I was trying get out of my contract and put back on MLS with flat fee service that will also give me a lock box and a sign. I'd put my cell phone on it and of course pay an agent 3% if they bring a buyer. We are already getting calls for showings and my agent is taking 24hrs to 48 hrs to get feedback from showings.. I would just rather call myself to get more immediate feedback.
If we move in Sept as I think we'll be doing (house sold or not) .. we'll leave our sparsely furnished house as is.. hire a cleaning service and have my inlaws water lawn, cut etc. We'll look like we're here but we won't be.
My agent told me she thinks it will pick back up in September.. that seems odd to me.. I would think we have August and that's it for awhile.
Again.. if I went with flat fee service for $499, then I could drop price by more then 10k and still walk out solvent.. this MLS service I was looking into populated more then MLS.. it also did a bunch of other websites.
I am frustrated because Northern KY's market up til a few months ago wasn't supposed to be a problem. It's getting freaked out (I've read) because of Florida and California's troubles.
Again, we haven't had the run up of prices like other parts of the country. We only had 2 showings and my agent said all showings for all houses are down.. she didn't think price was a factor but that there just weren't people out.
Am I being strung along? I do think this will sell.. I am hopeful, just anxious and balancing my anxiety with reality. If the market is that bad here.. I wish it would drop more quickly in Florida..
The first house I sold in 2000 sold in 1 week. My second house I sold FSBO in 2 weeks ( this was fantasy land Orlando in 2003 .. and we made 20k on the deal... ) I would never expect to make that again on a house. My third house I rehabbed and walked out pocketing 10k and sold in 2 weeks. Here I am on #4 realizing that I will never again buy a house that needs work done on it unless it's really undervalued.
The sad thing is when we bought the house we would of paid more if it had been updated. It's not cookie cutter.. but a well built custom home from the 80's.
I would review you current market placement and make sure you're one of the lowest priced if not the lowest. Your home needs to attract buyers.
If I thought it would pick up in a few months, then I'd wait it out. Cincinnati doesn't have a economy problem or over priced housing -- overall... I am still within 15 minutes of downtown and one of the lowest priced homes in a very expensive neighborhood.... granted.. i realize it's subjective.
After reading your post below, I'd like to add that the single best thing you can do is lower your price. And I don't mean just a little bit. And be realistic, the house will only sell for the amount a buyer will actually pay today. It's just not relevant what you put into it (appliances, etc.). I know sellers hate to hear this, but it's a fact.
The only way to steer buyers to your door will be to increase exposure and LOWER THE PRICE.
I need it on the MLS and I either need to lower price to generate more interest (we've had 9 showings in 14 days and out of those 1 was my listing agent showing a few other agents and 2 cancellations ). Decent feedback so far, except 1 that said it was overpriced and wasn't going to keep looking in our county.
I don't mind getting the calls and setting the appointments, as long as there is a lock box.
If I lower price, I need it to come out of something other then my pocket. Right now, based on Trulia, I am priced at $109SF (average is $117).
I am not happy with my agent.. obviously if the house sells in 30 days I'll be excited but I won't recommend them to anyone else.
The money saved if we switch will be to lower the price so we can hopefully walk away with enough to pay off the new appliances and closing costs. I do not want to bring money to closing and I can't let it sit much longer without serious movement/interest.