When is it Time to Drop Your List Price?
It can be nerve-wracking enough just putting your home up for sale, but what do you do when there are little to no offers?
A common reason is that the price may be too high. Below are some helpful guidelines to help in determining if lowering the selling price is the next course of action for you.
Is It The Price Or The House?
When your house has been on the market for a length of time and no buyers have committed, it’s time to re-evaluate things. The most important thing to think about, is the reason why your house is not receiving offers. Is it truly because the price is too high? Another possibility is that the home isn’t well prepared or lacks what today’s millenial buyers are looking for. If you are seeing some interest and having some showings but no offers coming in, then price is probably not the issue. It is most likely the condition or staging of your home. On the other hand, if you aren’t getting any interest at all in the home then most likely the reason is the price. If the price is too high, buyers may completely bypass the listing and move on to one with a fair market price.
What Are The Main Reasons To Lower A Price?
A good statistic to know is the DOM (Days on Market). This is the number of days a home is on the market. Research similar homes in the area and look at their DOM. If your home has a high number, lowering the price is a good option. Buyers who see a home has been on the market for a lengthy time, may feel that there is something wrong with the home. If you have a deadline to move, for example a job relocation, then bringing the price down will help speed the process along.
Another reason for changing the price is due to quick changing market conditions. If the market changes then sellers must as well.
How Much Should The Price Be Lowered?
When pricing a home from the get go, an analysis of comparable homes in the area should be done. This will give a fair and competitive price for your home. When you are faced with one of the above situations that call for lowering price, go back and look at similar homes again and ensure your price isn’t too far from the market price. It is always good to price a home so that there is room for negotiation but don’t get stuck on it, if in 2 or 3 weeks you get no interest, you may want to start to lower. Reducing in increments of $5000 is a good start but don’t bring your home lower in price than the lowest price of similar homes. One thing to remember is you don’t always have to start lowering the price, adding incentives is another motivating factor for buyers!
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