How To Tell If Your Property Is Overpriced
Let's say you have a single family home that has been for sale for months and months. You've reduced the price a few times and your real estate agent keeps hounding you to make the price even lower.
How do you know if the house is overpriced?
Should you have your agent do another CMA?
Should you hire an appraiser to prepare a certified appraisal?
Should you look around the neighborhood to see what other houses are selling for?
Well, those are all good ideas that make sense.
But here's a better idea: Make an in-depth review of the marketing program executed by your agent before trimming the price further.
By doing a marketing review, you will discover if your property is being properly advertised. Remember, if nobody knows your house is for sale, nobody's going to buy it no matter what the price is.
You should make a close examination of everything except price.
Among the many items you need to examine in a marketing review are:
1. The general real estate market. It might be that the market is weak where you are and everyone is experiencing long periods of time on market. You need to know the overall market in which you are trying to sell.
2. Property appeal. Stand out in the street and try to honestly gauge your home's curb appeal. Be honest. Then, look down the street and examine how appealing your neighborhood is. Is this the kind of house and neighborhood people want? If not, correct what you can.
3. Advertising. You and your agent need to discuss both the quantity and the quality of the advertising. Is it good advertising that emphasizes the better points of your property and neighborhood? Is the advertising frequent enough to have real impact among prospective buyers. An ad once in a blue moon just won't cut it in today's market.
4. Open houses. Have you had open houses with enough frequency that buyers are aware of your home? Or, have open houses been few and far between? When you had an open house, were it heavily promoted, or just lightly hyped?
5. Internet. Over 80-percent of buyers today start shopping for a home on various internet sites. Is your house being promoted on internet sites beyond the local MLS system?
6. Exposure to agents. Most likely, your house is going to be sold by an agent who is not your own. Is your agent advertising your house to other agents? He should be because that's most likely where the buyer is hiding.
I'm not going to write a marketing plan here but the above are a few of the kinds of things you should be looking at in this marketing review.
Now, if you are comfortable with the marketing effort and the house still has not sold, then the problem is probably not related to marketing. So, it might very well be a pricing issue. In that case, most likely the house is still overpriced.
On the other hand, if the marketing effort seems lacking, I wouldn't drop the price again. I'd require the agent to beef up the marketing and see if a buyer can't be found at the current price if you think it is fair. If the agent won't punch-up the marketing, well, maybe it's time for a more aggressive agent rather than a less aggressive price.
I'm of the opinion that houses stay on the market for one of two reasons: They are either overpriced or undermarketed. If the marketing is okay, then it's probably the price ... and vice versa. You need to determine which boat you're in and correct your course to get your property sold.
For more information on real estate in the Tampa Bay area, visit my website at http://www.thestpeterealestatesite.com/.
How do you know if the house is overpriced?
Should you have your agent do another CMA?
Should you hire an appraiser to prepare a certified appraisal?
Should you look around the neighborhood to see what other houses are selling for?
Well, those are all good ideas that make sense.
But here's a better idea: Make an in-depth review of the marketing program executed by your agent before trimming the price further.
By doing a marketing review, you will discover if your property is being properly advertised. Remember, if nobody knows your house is for sale, nobody's going to buy it no matter what the price is.
You should make a close examination of everything except price.
Among the many items you need to examine in a marketing review are:
1. The general real estate market. It might be that the market is weak where you are and everyone is experiencing long periods of time on market. You need to know the overall market in which you are trying to sell.
2. Property appeal. Stand out in the street and try to honestly gauge your home's curb appeal. Be honest. Then, look down the street and examine how appealing your neighborhood is. Is this the kind of house and neighborhood people want? If not, correct what you can.
3. Advertising. You and your agent need to discuss both the quantity and the quality of the advertising. Is it good advertising that emphasizes the better points of your property and neighborhood? Is the advertising frequent enough to have real impact among prospective buyers. An ad once in a blue moon just won't cut it in today's market.
4. Open houses. Have you had open houses with enough frequency that buyers are aware of your home? Or, have open houses been few and far between? When you had an open house, were it heavily promoted, or just lightly hyped?
5. Internet. Over 80-percent of buyers today start shopping for a home on various internet sites. Is your house being promoted on internet sites beyond the local MLS system?
6. Exposure to agents. Most likely, your house is going to be sold by an agent who is not your own. Is your agent advertising your house to other agents? He should be because that's most likely where the buyer is hiding.
I'm not going to write a marketing plan here but the above are a few of the kinds of things you should be looking at in this marketing review.
Now, if you are comfortable with the marketing effort and the house still has not sold, then the problem is probably not related to marketing. So, it might very well be a pricing issue. In that case, most likely the house is still overpriced.
On the other hand, if the marketing effort seems lacking, I wouldn't drop the price again. I'd require the agent to beef up the marketing and see if a buyer can't be found at the current price if you think it is fair. If the agent won't punch-up the marketing, well, maybe it's time for a more aggressive agent rather than a less aggressive price.
I'm of the opinion that houses stay on the market for one of two reasons: They are either overpriced or undermarketed. If the marketing is okay, then it's probably the price ... and vice versa. You need to determine which boat you're in and correct your course to get your property sold.
For more information on real estate in the Tampa Bay area, visit my website at http://www.thestpeterealestatesite.com/.
-30-
posted by Terry Ward at 12:55 PM
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