In a real estate buyers market, such as the one we’re currently experiencing in many parts of the country, setting the correct asking price for your property can easily become the most challenging part of your Realtor’s marketing mix. As it is, even in a balanced real estate market, pricing a home at market value is often a difficult task, because every home is unique and proper adjustments to comparable properties need to be made in order to arrive at a meaningful asking price for your property. By definition, a sales transaction would then occur when supply meets demand. And finding that intersection where your Realtor will find demand for your home depends in large part on your pricing decision.
In my dozen years of assisting homeowners with the sale of their properties, I have found that the vast majority of showing requests (from Realtors) for a listed property are made within the first week of the property being listed for sale on the market. It’s what I would call the “Golden Week”. It’s when the “action” takes place. The reason for this phenomenon is that the Multiple Listing Service (MLS) systems in use today across the country are supercharged high-tech pieces of software that allow Realtors to instantly and automatically notify their buyer clients about new properties that enter the market for sale, based on the buyers’ pre-defined home search profiles in the MLS. Time is of the essence. Within the MLS, listing agents are even able to see stats about how many and which Realtors have emailed the new listings to their buyer clients.
Assuming that your Realtor has fired off the remaining weapons in his/her marketing arsenal (advertising, Internet exposure, open houses etc.), there should be numerous requests to view your property, IF, you have priced your house competitively. However, since property valuation is more of an art rather than a science, as any appraiser will tell you, there is a correct way to reduce your home’s asking price when your Realtor’s phone won’t ring. The thing to keep in mind is that it is possible to reduce your price, but you cannot increase it.
The major mistake that I see many sellers make in a buyers market, once the “Golden Week” has passed without any significant buyer interest, is to keep dwelling on the originally set asking price for weeks to come. After being listed for a month and a half or two with perhaps three showings in total, these sellers suddenly decide to reduce the price by a huge margin of often $15,000 or more. Subsequently, buyer interest is revived, and showings pick up. But why wait for so long, and why such a big price reduction?
Remember, your Realtor’s job is to test the market via the price of your property. Your agent’s job is to find that intersection where a ready and able buyer lurks, and is willing to buy your property. That intersection has to be approached carefully (price reductions in smaller increments) but swiftly (shorter intervals between price reductions), in order to meet the bona fide buyer at the right time and at the right place, before she moves on to your competitor’s property. Otherwise, your property will continue to linger on the market, and even in a buyers market that may lead to the often incorrect perception that there is something physically wrong with your real estate.
