As a seller, you may have an ideal price in mind when listing your house. With the frenzy of the real estate market over the last couple of years still fresh in your mind, you may be expecting well-over-asking prices for your home with all sorts of waived contingencies.
But the market is starting to turn, and what you may have commanded for a price at the beginning of the year is not the same as what you would get right now. According to Bankrate, price growth dropped by 2.3 percent between June and July — from 18.1% to 15.8% — the largest one-month decline. A big factor contributing to this is the rise in mortgage interest rates, which as of this writing hover around seven percent.
When listing your home for sale, determining the right asking price from the get-go is critical. But even with comprehensive analysis from your real estate agent and an appropriate list price, your home could still sit on the market for longer than you’re comfortable with. When should you consider a price reduction to attract more buyers?
Going Below What You Want: When to do It
Here are some top indicators that your asking price should be lowered or you should consider accepting a less-than-top-dollar offer:
- Little traffic with no offers: This indicates that the home is overpriced. You should adjust the price lower to capture the interest of potential buyers.
- Good traffic yet lowball offers: If the house is getting good showing traffic but paired with low-price offers, this could mean you’re close to market value but need a small price adjustment.
- Good traffic but with negative reactions: If you’re getting buyers to come to the house but they are balking at the price, you’ve probably set it too high.
The best time to reduce the price of your home is fairly quickly, such as within two weeks of the original listing. That’s because most activity on most properties will be seen in the first 21 days on the market. You don’t want to miss that window and have a house that’s lingering on the market for months on end.
An early price reduction gives you a chance to do two open houses on back-to-back weekends. If you reduce the price too late, buyers will see how many days it’s been on the market and take the opportunity to save money by lowering their offers. In this case, accepting a lower price than you originally intended could be a good idea just to get it sold.
There are other scenarios where accepting a lower offer than the asking price is a good idea. Perhaps you’re getting divorced and need to sell the home immediately, or maybe you got an amazing job offer relocation you can’t refuse. Perhaps you lost your job and can’t afford that big house anymore, so you have to get out before you miss too many mortgage payments. Whatever the case, sometimes accepting a bit less money is better in the long run because it allows you to sell the property and recover quickly.
Contact Berkshire Hathaway Premier Properties for Help in Selling Your Houston Home
Setting a listing price can seem tricky, but this is why you should hire a seller’s agent to do all the research necessary to come up with an appropriate price from the start. To connect with an agent, contact Berkshire Hathaway Premier Properties right away at 713-862-0000.