Why should I reduce my home price away because there are vacant housing for sale around my home? My home was built new in 2002.

Asked by Classact, Missouri Sat Jan 2, 2010

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Don Tepper, Agent, Burke, VA
Sat Jan 2, 2010
It doesn't matter when your home was built.

It doesn't matter if there are vacant homes for sale around your home.

All that matters is: What are comparable homes selling for? SELLING FOR. If the vacant homes nearby aren't selling, and they're similar to yours, then they're priced too high. If they aren't similar to yours, then forget them. The question is: What are people willing to pay for homes like yours?

Not: When your home was built. Not: Whether your home is vacant or occupied. None of that matters.

You don't say what your home's priced at, and what comparable sales went for. So it's impossible to say whether you should reduce your home price. But I get the sense that you somehow believe that your home can or should be priced higher than the nearby vacant homes for sale. Untrue. Doesn't matter. If you want to sell your home, it has to be priced in the same range as recent comparable sales.

Clear?

Hope that helps.
1 vote
Keith Sorem, Agent, Glendale, CA
Mon Jan 4, 2010
Classact
Remember, Realtors do not make the real estate market. An excellent Realtor can interpret the market conditions and provide you with option in order to help you make the best decision based on your circumstances.

Examples -
1. Your priorities #1 get your son in school, #2 move to Miami, #3 find a place to live....
2. If these are true, then you need to realize that given the current market conditions you in fact may have to rent in Miami.
3. Selling your current home - discuss the number of homes, like yours, that are on the market right now. How many homes, like yours, sold last month? If there 100 homes like yours, and 20 homes sold last month, it is likely that your home will take five months to sell. Is that okay? If not, then you'll need to find a way to make your home stand out, which is why you have a REaltor.

Good luck.!
0 votes
Horace Bryan, Agent, New York, NY
Sun Jan 3, 2010
Classact, NEVER NEVER out rightly reduce your price.
Let me lead you into some Horace Bryan style DECEPTION here. You will just raise the price by $1K and add NOTICABLE VALUE to your property. Something like offering to pay the closing cost or buying down the interest rate for the buyer. And while you are at it, add 5% to your agreed on commission (don't hit me) but stipulate that it should all be added to the cooperating agents split providing an all cash full price contract be affected in 30 days. Now here is the big DECEPTION. it's hardly likely that anyone will achieve this, but your listing will get LOTS of EYEBALLS. They call me the great deceiver you know? Of course, you should only do this if you are convinced that you are overpriced.
0 votes
Anna M Brocco, Agent, Williston Park, NY
Sat Jan 2, 2010
Not knowing all the details as to why the vacancies exist in the first place--are the vacant homes foreclosures, new and never sold etc.-- the best advice is-- if you'd like to sell sooner rather than later, you need to strongly consider a price reduction--what is your agent advising you to do--have you looked at similar recent closed properties in the area--if so what does the data suggest--keep in mind that a home is worth what someone is willing to pay for it; it doesn’t matter what the seller “needs” or potential buyers can afford to spend. Market conditions do matter as does the immediacy for a transaction to take place--again if you need to sell a price reduction is in order.

Anna
0 votes
Catherine "C…, Agent, Metuchen, NJ
Sat Jan 2, 2010
Hi Classact,

In your second comment you mentioned: "...in Miami, Florida and there market of course is way different."
So you understand that real estate market behaviors are local and consequently depend on their surroundings.
If you have a subsequent amount of vacant homes around you, most likely it means that there are more supply than demand (for whatever the reasons are...).
When you have a lot of supply and little demand, which way do you think it is going to pressure prices?

I do not know your specifics and I am just trying to bring supply/demand vs. prices principles in this discussion. A local realtor would be able to provide you with local statistics and more…

Catherine "Cathy" Chaudemanche Team
Real estate agent & Realtor associate
Agent Leadership Council
Keller Williams / Middlesex County NJ market center
Web Reference:  http://yourhousefast.com
0 votes
Scott Sulliv…, Agent, Redmond, WA
Sat Jan 2, 2010
Classact,

I'm not certain by your description what your neighborhood is like, but if there are vacant homes in your neighborhood I am going to assume that you likely have one of two things going on in your community. You are either in a community that still has a builder building homes that are sitting vacant and/or you live in a community where people have been forced to move out of their homes and they are vacant due to short sales or foreclosures.

If you are in a community where builders are still building you are at a disadvantage trying to sell your home if you have priced your home higher than what the builder is selling his spec homes for. People like new things so if they can buy a new home from the builder that is cheaper than your "used" home why wouldn't they?

If you are in a neighborhood with a lot of foreclosures or short sales then you are a victim of circumstances beyond your control. Most buyers finance the purchase of a home and in order to obtain a mortgage the property has to appraise for at least the amount of the loan or their bank won't lend them the money. In a declining market (like greater Jacksonville, FL where I live) appraisers will use comparable homes in your neighborhood that are short sales and foreclosures which will likely drive down the average home value.

You can resist this reality, but if your home is overpriced it won't sell or won't appraise. I would suggest that you ask your Realtor to provide you with an analysis of current market conditions and be prepared to price your house in the most likely range that will result in a sale. If you're unwilling to price it in that range than you should take your home off the market and wait until you can sell it for the value you believe it has.

Good luck.

Scott Sullivan
Realtor
Prudential Network Realty
3535 Highway 17, Suite 10
Fleming Island, FL 32003

C: 904-327-5676
O: 904-269-1716
Scott.Sullivan@PrudentialNetworkRealty.com
0 votes
Joseph Washi…, Agent, Berwyn, IL
Sat Jan 2, 2010
Wow, your question rings so familiar with my own personal experience lately. I am a real estate broker in Berwyn, Illinois and I represented a seller for a year and a half, nearly 18 months, with a listing in a neighboring village. My seller built his house new in 2006! Well, we reduced over 75 thousand dollars to sell for nearly a hundred thousand dollars less from the original list price. There is no fairness to sellers in a depressed "buyer's" market. My listing was the highest-priced listing sold in this village in the last year and I was proud to get it sold for the price we managed to achieve. I won't dwell on the short sales and other challenges sellers have nationwide. The Chicago Tribune front page headline a few weeks ago... "1 of 4 sellers under water". I'm not sure if that was a regional story or national one but it really doesn't matter. The fact is that we are all dealing with negative-pricing pressures due to the glut of foreclosures and short sales on the market nearly everywhere. I do hope that 2010 brings you and my sellers more hope with the possibility of a more robust real estate market. Let's hope the $8,000 federal tax credit to first time homebuyers helps to influence more buying activity NOW! (smile)
0 votes
Classact, Home Seller, Missouri
Sat Jan 2, 2010
Responding to your answer. I know it has nothing to do with when my home was built but my home is 7 yrs old in great condition and the only one on the block in front of a park. My home is on the market for $115,000. in Kansas City, Missouri the Independence Plaza Area. My realtor states that there is no comparables to my home. I was told also because there are so many over 100 yr old homes and vacant lots and houses around the 1/4 - 1/2 mile radius to my home that I needed to drop my price to almost given it away I need to relocate, I must move to Miami, Florida to get my son in school as well as start my new job. I must have money to purchase a place to live in Miami, Florida and there market of course is way different.
0 votes
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