Chasing the market.
This has happened several times in my real estate career. I now know the term for it. When people are selling their homes, they try to convince the listing agent to start high and come down low. There is more than one reason that is a disastrous approach to take.
First of all, the listing will get looked at the most in the first 30 days of the listing. If it is too high, the serious buyers will toss it to the side and move on to the next potential home. Alot of times, we Realtor's will convince them to do a price reduction after a set amount of time so we can "please" our sellers and get the listing. That leads to the next big problem.
After agreeing to "start high, then come down" we have not done any justice to our customers. Let's just say that at the beginning of the listing the customer wants to start at $400K but, it really should be at $375K. The seller insist and the agent gives in but, makes them agree to do a price reduction at the end of the month to the suggested listing price of $375K. 30 days pass us by and no activity. There went the best 30 days of the listing. Not only that, now we get the listing to our price of $375K but, the market is reflecting it should be priced around $360K-$370K. We spend another few weeks asking for an additional price reduction based on the current market conditions. However, by the time we get it priced right, the comps are coming in lower than the month before and we are again, "CHASING THE MARKET".
It's nice to know there is term for such a frustrating situation. Now, I can go to therapy to get help with it, or price my listings right from the start.
First of all, the listing will get looked at the most in the first 30 days of the listing. If it is too high, the serious buyers will toss it to the side and move on to the next potential home. Alot of times, we Realtor's will convince them to do a price reduction after a set amount of time so we can "please" our sellers and get the listing. That leads to the next big problem.
After agreeing to "start high, then come down" we have not done any justice to our customers. Let's just say that at the beginning of the listing the customer wants to start at $400K but, it really should be at $375K. The seller insist and the agent gives in but, makes them agree to do a price reduction at the end of the month to the suggested listing price of $375K. 30 days pass us by and no activity. There went the best 30 days of the listing. Not only that, now we get the listing to our price of $375K but, the market is reflecting it should be priced around $360K-$370K. We spend another few weeks asking for an additional price reduction based on the current market conditions. However, by the time we get it priced right, the comps are coming in lower than the month before and we are again, "CHASING THE MARKET".
It's nice to know there is term for such a frustrating situation. Now, I can go to therapy to get help with it, or price my listings right from the start.
posted by Carrie at
1:50 PM
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