- The Washington Times - Thursday, September 14, 2006

I just returned from a conference of top agents from the Washington metropolitan area, and though they are working harder this year than last year to turn a deal, they are moving forward with their businesses by working with motivated sellers and buyers.

“The market is the market,” one told me. “You have to sell and buy real estate in this market, not last year’s market, and not the market you wish it would be.”

One thing all top producers had in common was that they “got it” about the kind of market they are in, which is more than they could say about most of the buyers and sellers trying to move from one property to another. Here are a few of the excuses sellers are using to justify the price of their houses.

What sellers say: “I need X number of dollars from the sale of my house.”

The truth is: With all due respect, it doesn’t matter how much you “need.” The market determines the sale price of a house. I just saw a home that has been on the market for 328 days in Loudoun County, Va. The price has dropped $150,000. That seller understands that it doesn’t matter how much he “needs.” However, he probably would have sold it earlier if he had dropped the price more quickly.

What sellers say: “I have a bigger lot.”

The truth is: You can’t live on the lot. Though the size of your lot will make the property more desirable (for some buyers), it doesn’t necessarily add more value in a buyer’s market. Price according to other houses like yours, not other lots. This is particularly true in a subdivision where the lots are mostly created exactly alike.

What sellers say: “There’s one special buyer out there.”

The truth is: Though this may be true in some instances, for most properties, there are several buyers — if you have the house in the right condition and offered at the right price. Overpricing a property and waiting for a stupid buyer is a waste of everyone’s time.

What sellers say: “Advertise more.”

The truth is: Pricing a property correctly is the best advertising you can use. The best property with the worst price still won’t sell. The best property will at least bring about some offers, but not necessarily the asking price.

What sellers say: “If I don’t get X number of dollars, I just won’t sell.”

The truth is: Most sellers using this line mean they have overpriced their house and will die in it rather than drop the asking price.

There are three determining factors for the salability of a house: location, price and condition.

In areas where commuting is a daily battle, a good location definitely makes a property more desirable than a house miles and miles away. Location also may refer to the home’s location within the desirable community. The former model home facing the four-lane highway may be in great condition and in the right community, but the location on a busy road could adversely affect the salability of the house.

Price is what most homeowners are battling in today’s market. If a house looks great and is overpriced, it will not sell.

Even some “fixer-uppers” I have seen are overpriced. They may be listed for less than other homes in the community (which also are overpriced), but they’re still not selling because a great-looking house in the neighboring community sold for the fixer-upper price a week earlier.

When a house has more amenities than the competition, that doesn’t automatically mean it’s worth $50,000 more. In today’s market, it may mean it’s just going to sell faster.

Finally, the condition of a property is vital to the salability. Many top producers are challenging sellers to drive around with them to compare the sellers’ house with those already on the market. Those who tour other houses usually end up pricing their own house appropriately to make it a “good deal” compared to other homes in the area.

Remember, if someone can remodel a kitchen for $30,000 — why would he or she pay $50,000 more because you have one that was remodeled last year? Sellers and buyers who understand the market are cashing in and getting good deals. Sellers need to focus more on equity gain over the past several years, while buyers need to get off the fence and get a good deal.

M. Anthony Carr has written about real estate since 1989. Post questions and comments at his Web log (https://commonsenserealestate.blogspot.com).

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