by Todd Lewys
If your home has taken more time to sell than you thought it would, one of two factors could be responsible.
The first factor is today’s balanced real estate market. With more inventory to choose from, buyers can afford to take their time to find the home that best meets their wants and needs.
If one home doesn’t work, there’s sure to be another that will.
Factor number two is one that hits closer to home — the possibility that your home may be overpriced.
The fact is that if your home isn’t priced according to what the market will bear, it will be by-passed in favour of homes that are priced reasonably, and offer obvious value for the asking price.
REALTOR® Glen MacAngus said many vendors are still being unrealistic about what their home is really worth.
“You know, people call me and ask me to come and evaluate their home, and I happily do that,” he said. “Then, we sit down at the table. I provide them with good comparables (on how their home compares to similar homes price-wise), and outline a good marketing plan.
“They say, ‘Tell us what our home is worth. You’re the expert.’”
Unfortunately, that deference can turn into defiance if he doesn’t tell his prospective clients what they want to hear.
“I’ll give them my honest opinion on what their home is worth,” said MacAngus. “In a lot of cases, they pause, and say, ‘Yeah, but our friends think our home is worth more than that. We think the home should be listed for $20,000 more.’”
Those types of responses leave him shaking his head.
“Let’s just put it this way,” said MacAngus. “Here I am, an experienced REALTOR® who knows the market, and who’s sold thousands of homes over 30 years, and they’re listening to friends? The only word I can use to describe their thinking is, unbelievable.”
Fellow REALTOR® Cole Castelane said there’s another factor prompting vendors to ask top dollar for their home.
“Because interest rates are so cheap, say, 2.5 per cent, they may spend more than they would have if the rates were higher,” he explained. “So, they’ve maybe spent $100,000 more than they originally planned for. The house they’re selling may be worth $400,000, but now they want us to sell it for $500,000. That’s just not realistic.”
MacAngus said being unrealistic can lead to a chain of very undesirable events.
“I’ll reluctantly list the home at their price,” he said. “And then I’ll just watch and wait. In most cases, the vendor doesn’t get any activity, and then they get frustrated.
“At that point, I have to be honest with them and tell them they’ve priced themselves right out of the market.”
What follows that conversation is predictable.
“The vendor will actually listen to me and bring the price down to where I wanted it to be originally,” MacAngus said. “In one case, I dropped the price substantially. When I did that, the vendor said they were losing all that money. The home sold at that price, and they still made a nice profit. Yet, all they could think about was the money that, in their mind, they’d lost.”
He said another client came to him soon after, saying they wanted to sell their home as quickly as possible.
“I told them the home had to be set at a certain price to sell quickly. They agreed, we put it up for sale at that price, and one day later, someone viewed the home, loved it and made an offer with no conditions. The home sold in one day because it was priced properly.”
That said, not all homes will sell in one day even if they’re priced perfectly, added MacAngus.
“Even if a home is priced right, it still might take seven to 10 days to sell. Still, that’s way better than going through 60 days of aggravation because your home is overpriced. If a home is priced right and presents well, it will sell in a reasonable amount of time.”
Castelane said the key to a reasonably quick sale is a simple one.
“I’ve been in the business for 37 years, so I think it’s fair to say I know what I’m talking about. If you listen to your REALTOR®, instead of your friends or relatives, and go with the price we recommend, your home will sell fairly quickly and painlessly.”