It invariably happens, a property has been on the market for a short time and an offer comes in and the Seller is reluctant to take it because they think that if there is one Buyer out there that means that there may be more. If they only knew! Of course, I and other experienced professional Realtors® try and explain the phenomenon but until one actually experiences it, it often does not seem it is true.
In any given market sector, at any given point of time there is a pool of Buyers ready willing and able to purchase, waiting for the home of their dreams to come on the market. The real estate market is not a static entity; it typically doesn’t vacillate as much as the stock market, but it does react to the environment that exists at that point in time. The particular Buyer that writes an offer has more than likely seen everything available in the marketplace and is current on all the comparable sales and what is under contract. So when that buyer makes an offer they have taken into consideration the present market conditions.
If that pool of Buyers doesn’t purchase the property, or in effect “rejects the home” then that is in effect the “market study”. Any number of statistical market studies can be prepared, but the true market study is actually being on the market.
Properties priced too high attract fewer buyers, showings and offers. Properties priced at market value generate more buyer interest. If properties are priced too high then both buyers and agents lose interest. In fact, what they do is say to themselves that they will wait out the Seller, once the Seller gets more realistic then they’ll come back. But what they come back at is a much lower price.
During high school my son, Drew, worked at the local McLean Hardware store. He found that if merchandise had been on the shelf for some time and not purchased, then it gets “shop-worn” and has to be marked down in price in order to get it sold. Well the same is true for real estate. If the original pool of buyers has “rejected” the property, then it is more than likely the price that has to change to get them back. In order to make an impact on the market, I have found that the price change really has to be in the neighborhood of 10% market down, anything less just doesn’t get their attention.
Well-priced properties on the other hand generate immediate interest among buyers and agents. If the price is too high, that excitement never happens. Dropping the price later often does not generate the same enthusiasm. So how can I prove it is true? Experience for better or worse it seems is the best teacher. Unfortunately for the Seller, to pass up on the first offer is a hard lesson to learn. As you have heard, it isn’t possible to make a second good first impression.
The Huckaby Briscoe Conroy Realty Group is intimately familiar with the Northern Virginia, Washington DC and metro Maryland real estate market. Whether looking to buy or sell in the area, Karen Briscoe and Lizzy Conroy would be delighted to be of assistance. Please contact via the means most convenient for you: www.HBCRealtyGroup.com, 703-734-0192, Homes@HBCRealtyGroup.com.