What can we do to bring in an offer on our house?

Asked by Amy S, Carrollton, TX Tue Aug 21, 2007

What can we do to bring in an offer on our house? We've been on the market for over 60 days now. We've dropped the price, fixed or replaced everything we can think of. We are still getting 3-4 showings a week but no offers. Should we drop the house price any more? We're at $265,000 now and my realtor says $255000 would be better for searches. We are building another house in McKinney that should be ready next month. Will the market get worse in September buyer-wise? Should we hold out? Or drop it and get out before the fall?And do you think a builder will be willing to renegotiate price if I have to really drop our current house price?

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16
Bridgette Ko…, , Florida
Tue Aug 21, 2007
Amy,
There is great advice here already. My two cents: There is a difference between $255,00 and $250,000 as a list price. When searching for homes, buyers and agents alike use ranges such as $225K-$250K, or $250K-$275K. An oddball number like $255,000 would only show your house in one of the searches I described, while a list price of $250K would produce you house in BOTH searches. Best of luck!
3 votes
Scott Alexan…, Agent, San Angelo, TX
Tue Aug 21, 2007
Two thoughts: do something that benefits the buyer!! Some sort of incentive--closing costs, or a buy down of his interest rate if his lender will permit it. Look at your house as inventory on the shelf; X number of houses are selling per month in your price range and area. Y are on the market. You have to do something to make yours one of those that sells. If you lower the price dramatically, that will hurt all at once. If you do not, and it does not sell as a result, you may hurt a little bit at a time for months. . Not encouraging words, but talk to your realtor about it. Be practical; distill it all to money.
2 votes
J Lo, Home Buyer, California Glory, Brentwood, CA
Tue Aug 21, 2007
Hi Amy!
You are getting great traffic.. yet, something is keeping you from getting an offer. Sounds as if it could be price; but how do you stack up against your direct competition?

If structure, location, and a complete revamp haven't gotten you offers - then as Deborah stated - its got to be price.

As for 255 being better for searches, I don't know the exact science on that but what's the difference between 255 and 250? You could use that logic - but it doesn't hold water.

You need to review the prices (both what has sold and active listings) in your area - like home to like home. Know your competition and work agressively to market to those looking for your type of home in your location.

As for loans - be wary for now - and bridge loans are something you do - only if you can guarantee the sale within 30 to 60 days. Don't obligate yourself too soon.

If the foot traffic is there - your buyer is too. Make it worth their while to take a second look....

I feel your pain - and have been in your situation. Do what you have to (short of taking a huge loss)....

As for your builder - check your contract. Is there a contingency clause? Some builders will not accept the contingency - however, depending on your market they may be willing to negotiate. It's a long shot but it doesn't hurt to ask.

Good luck and my best to you on the successful sale of your home.
2 votes
Jim Walker, Agent, Carmichael, CA
Tue Aug 21, 2007
While positioning a list price to fit the bracketing theory (225K to 250K and 250K to 275K) is attractive to me in THEORY, it is just that - theoretical. Amy in 75007 has a boots on the ground Realtor who has done the research, knows her house, knows the competition, has done the feedback calls to the showing agents, and decided to reccommend 255K.

Amy's Realtor has to know about bracket theory and must have decided that the smaller price reduction should be sufficient to generate an offer, and has reccommended the smaller decrease in order to keep an extra $4,700 in the sellers pocket.
1 vote
Carrie Crowe…, Agent, Southaven, MS
Tue Aug 21, 2007
I have to agree with Bridgette and other posters about the difference between 250K and 255K. People do usually seard 225 -250 or 250 to 275. If you went 255, your would miss all of those potential buyers looking up to 250. At 250 you would hit both categories and double your potential buyers.

On the note about your house. If you have the traffic that you do and no offers are you getting any feedback to suggest what the problem might be? Sometimes the best place to find the answers is in the people that have looked and decided not to purchase. Goodl luck, I see you have gotten a lot of feedback from this question. I hope some of it helps.
Web Reference:  http://carriecrowell.com
1 vote
Susan Mccann, Agent, Marietta, GA
Tue Aug 21, 2007
Have you tried getting feedback from the showings. Sometimes what you think needs to be fixed or re-done is not what others are seeing. You should ask the agents and or others who have seen the property for their input it could help a lot.

Go out and view the other properties for sale that are similar in style and price to you home and make sure you are educated on the current stats. regarding your area, (number of homes for sale, average list price vs. average sale price, average days on market. Then make a decision about price.

As far as builders go, you sould have the conversation about price right now. New home sales are slower right now than re-sale, and the builder has a little room. Builders however usually like to give you credit by way of upgrades instead of lowering price.
1 vote
Diane Glander, Agent, Spring Lake, NJ
Tue Aug 21, 2007
If your agent recommended you drop the price to $255,000, you should. She/he probably checked comparable sales (which needs to be done at least monthly in a market like this) and sees that you are either over priced still, or is trying to make you the cheapest home in your market competition. I might take it a step further and to to 250 as most people search in increments. In your price range, it would be likely to find someone searching 200-250.
I cannot answer as to what your market will bring in September, but most markets get slower around the fall as the holidays approach. People want to be in for the school year for the most part--that's why activity is highest in the spring.
I doubt that your builder will renegotiate the price on your new construction. Business doesn't work that way.
Web Reference:  http://www.dianeglander.com
1 vote
T, , Denver, CO
Tue Aug 21, 2007
I've had some success with offering potential buyers' temporary and permanent interest rate buy-downs. Also, we have Bridge Loans and Departure Loans that can pull equity from your current home to use towards the new house. These loans can help with closing costs and down-payments, and can buy you some time to sell your old house.
1 vote
Deborah Madey, Agent, Brick, NJ
Tue Aug 21, 2007
Hi,

While I think it is unlikely a builder will renegotiate with you, it may not hurt to try. If you landed a windfall on your sale, would you be willing to pay a bonus to the builder. Probably not.

If you are getting showings, you are getting interest, and therefore I am going to assume you have good exposure and marketing behind you. A great house that is a secret doesn't bring you a contract. Conversely, all the promotion in the world will not sell a property that is overpriced.

When you are substantially overpriced, you will not even get showings. The buyers will opt to look at other properties and the buyer agents will recommend other properties. When you get some showings, it is an indicator of interest, but you didn't quite cut it. Something is holding the buyer(s) back. Buyers make their purchase by comparison. If a competitive property meets their needs at a lower price, they will choose that property.

Since you are getting showings, I assume exposure is adequate or even better than adequate. This brings it to pricing and presentation. You said you fixed everything.

If you home is bright and shiny, in good condition and de-cluttered, you have elimiated all the obstacles except price.

The longer you stay on the market, the greater liklihood of an even lower sales price. A first question of many a buyer is "How long on the market?" The bigger the number of days, the buyer hears the message that the bigger a discount he shall reap.

From your description, lower your price.

Good luck.
1 vote
Judi Monday,…, Agent, Green Valley, AZ
Wed Jul 21, 2010
Actually I don't think $255,000 is any better of a search price than $265,000 from an internet standpoint. Whenever possible I always advise my Sellers to price for internet real estate sites--where most people will search $225,000 to $250,000 or $250,000 to $275,000 -- by pricing at $250,000 you wind up at the top in one of the searches and at the very bottom in the second search.

When I am working with a Buyer on a new build I always include a clause that allows for a re-negotiation of price should the builder drop their base price during the time the house is being built or if there is a major shift in the market. Short of having something of that type in your contract, I doubt the builder will be willing to give a price concession.
0 votes
Becky Hopkins, Agent, Carrollton, TX
Wed Jul 21, 2010
Location; correct pricing is huge; condition of property (how the house shows); and effective mktng are all important. In today's economy, it is especially important to know the market (type of buyers who will be interested in your house).

There are forecasts but no gtys about what will be happening in Sept or any other month. Houses sell all 12 months of the year, but typically there are fewer buyers in the last part of the calendar year. This is one area where your choice of brokers is important. A broker needs to have systems in place that effectively market your property outside the area as well as locally because people are always being relocated.

I'm guessing your buyer won't re-negotiate your contract. They will more likely return it to inventory and find another buyer and of course, you aren't likely to recover your earnest money.
Becky Hopkins
Direct: 469-568-7654
Web Reference:  http://www.50andholding.com
0 votes
Michael Russ…, , 75006
Thu Mar 11, 2010
Obviously this answer is way late but may pertain to others. From $265k to $255k may be an unneccesary large drop if sold comparables show $265k like you started with. Sometimes as little as $1k-$5k drop is enough to pique new interest. Also with any drop the agent can contact interested parties and let them know the exciting news! Feedback if given from showings is sometimes very useful in determining what kept the potential buyers from choosing your property. Clean, clutter free, up to neighborhood standards if going for top of market, inviting entry,etc. Lighting, smell, cleanliness are all essential. best of luck.
0 votes
Michael Ford, Agent,
Fri Aug 24, 2007
Revisit the Market Analysis and see if you are priced correctly. You don't want to chase the market down. That said, if you are in a 60-120 day market in your 'hood then you're not at panic stage yet. The historical norms must be respected and the fact that you are getting showings is a sign that you are not poorly priced. Sometimes the market takes a little longer than we like.

a $249,999 price point will boost search hits.

Boosting the commission will make you popular with the agents and an offer to pay down the interest rate will make you popular. The recent rise in interest rates has disappointed some buyers who still want that 6% mortgage they heard about...buy it down for them by paying a point or two.

There's certainly no reason why the builder shouldn't be invited to your painfest...if the guy has buyers lined up then he can always tell you to take a hike but my bet is that he is likely looking at cancellations and a haircut by you is preferable. he will be intimately familiar with the likelihood of reselling at the same price or terms. You will get resistance though of he has other inventory that he want s to sell at higher prices...builders resist price cuts and prefer to add amenities. It lets them bury concessions in the deal and still have high sale prices for subsequent sales.

good luck and report back please.
0 votes
Keith Sorem, Agent, Glendale, CA
Fri Aug 24, 2007
Amy
The key to a buyer deciding to purchase your home is VALUE. Selling a home after school starts is a much different animal, so time is not your friend right now.

You've had some great advice here, so here is my two cents:
1. Definitely see if the builder will be flexible. If you don't ask, you'll never know.
2. I would ask your Realtor to have a lender develop a buy down program. Making the home more affordable to the buyer is the absolutely BEST thing you can do. However, the buyer's need to know about it. Over 90% of the time, another Realtor will bring the buyer, so you need to do a little homework:
a) How many homes are on the market, right now, like yours?
b) How many homes, like yours, of sold since your home hit the market?
c) What other buyer incentives are the competing listings offering?
Offering a buy down program is good, also helping a buyer with closing costs is good.
d) consider increasing the commission rate. It may be that increasing the incentive to the Realtors will bring you more acitvity.

One note: All these steps should be taken AT ONE TIME for maximum effect. I do not know how long your home has been on the market. If more than a month, I would suggest you freshen up your listing:
Paint the front door, plants some flowers in front, re-organize your living room, re-shoot the pictures, and re-launch the listing. I send out 200 postcards to the local neighbors announcing the "new listing". About 37% of the time a neighbor recommends to a freind that they buy your home to be in their neighborhood.
Keith
0 votes
Kaye Thomas, Agent, Manhattan Beach, CA
Tue Aug 21, 2007
If your home is in good condition and you are getting showings but no offers I'm wondering if the property has a flaw.. bad floorplan or on a busy street. If none of the above is true then it's time to lower the price.
have your agent pull information on similar properties to yours that have gone into escrow in the last 30 days and pay special attention to those that sold quickly. This is your competition.. most of the property that has sold is "old info" as for those that have been on the market a long time they have problems too.. so use pendings and price your home at or just slightly below the last comparable home that went into escrow. Good Luck..
0 votes
Amy S, Both Buyer And Seller, Carrollton, TX
Tue Aug 21, 2007
Our MLS # is10823881 if that helps
0 votes
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