The Shifting Market has Created Two New Enemies for Sellers
The newest change in the Real Estate market has created two new enemies for sellers: “Overpricing” and “Number of Days on the Market”. We know this from personal experience and empirical evidence based on the most recent statistics.
Our experience comes from our recent showing of homes to buyers on a daily basis. After they look at the price of the home, the next thing they look at is “Days on Market”. If the home has been on the market for anything over 30 days, they believe they can immediately “low ball” the sellers. It’s like they become ravenous wolves and treat the home like a dead carcas. They then suggest we put an offer in that is WAY below list price.
This is also confirmed by actual statistics.
If you look at the chart below, the homes that are priced accurately and need no price reduction, they are selling in 9 days for an average of 1% below list price. But if they are OVERPRICED by 1-4%, their final sales price is more 5% below list price. But if they REALLY OVERPRICE it (by over 5%), then their final selling price is OVER 13% below list price.That loss is normally in the Tens of Thousands of dollars!
All of this is closely related to DOM or “Days on Market”. Those last homes that took the biggest discounts were on the market an average of 58 days. It’s primarily because buyers are taking advance of the weakened position of sellers who have overpriced their homes and allowed them to languish on the market. In fact, we even teach our buyers that “overpriced homes are the places where you can get the biggest discounts”.
Here’s the actual stats that back that up (taken from “Orange County Housing Reports” by Steven Thomas)
Our goal for your home is always to get you the HIGHEST price that the market will bear. But this market has rapidly shifted to a buyer’s market. So we need to adapt our strategies to ones that will maximize your position in front of buyers by pricing it accurately and getting it sold quickly.