I have five listings currently, and three owners are comfortable waiting.  The other two want/need to move, so how do I handle it?

This is a short sale, a 3/2, 1794 sf one-story in North Escondido near Castle Creek Golf Course. The sellers got divorced but needed both incomes to afford it, so there is no choice - must sell.  The loan balances equal $460,000, and they had been trying to sell with a discounter for $465,000, with no luck. 

This is quite typical. Instead of figuring what a house will really sell for, people try to list for a little above the loan balances.

Well, I have news for you. The buyers today couldn't care less what you owe on your home.

Or how much money you put into it.

Today it's all about price and terms.

What you need to "get out of it" is totally irrelevant.

When we started in August I gave them my rule-of-thumb: If nobody is looking at your home, you must be at least 10% wrong on price.  So we listed for $419,000.  Over the next 30 days there were two offers lower than list, and by the time the sellers stopped squabbling, the buyers gave up.

Jim is in an awkward position here. He tried to get the sellers to agree, and of course they didnt' like the price. I will say that it is wonderful he was able to get some offers. Today there are a lot of people who wish they had people looking, let alone offering.

But wait…

A couple of weeks ago an offer was presented for $350,000 - which was pretty low.  But my job is to get it sold before it gets foreclosed - I don't get to play judge and jury on the offers, the bank does.  How many other agents will just dismiss a low offer as frivilous, yet a few months later have regrets? 

All offers should be relayed to the buyer, and I can see from reading Jim's blog that he is a conscientious guy who would treat all offers seriously.

If you are listing and selling your own house, let's say using the sell your house in 9 days method, you can quite quickly get serious offers and you don't have to go through an intermediary either. Some people are better off if they can find someone like Jim, but many agents are not going to be as good and it's hard to know for sure that you, as a seller, are getting all offers and that your agent is encouraging even "lowball" offers. Many agents drop the ball and the seller is never aware of serious interest they might have had, if only their agent didn't block the interested buyer because the offer was "frivolous".

The right thing to do is to lower the list price to see if anyone else is out there that will pay more - so we lowered it to $399,000. Nothing. This week we lowered it to $379,000, and figure that if nobody surfaces - at least I can show the bank that I tried to do better.  The last comp is $385,000 from 10/5/07 for a 1,582 sf two-story foreclosure that needed carpet and paint, and had some funky remodeling.

What do comps really mean today? The "right" comp may be the one in escrow (or under contract for you folks in the East) and it could be $30,000 lower than the last reported sale price. That is the problem with comps today.

This is fascinating so let's continue…I hope Jim doesn't mind.

T

 

There were three closed sales this summer over $800,000, so we started at $839,000 - but that was 90 days ago.  There was a 2,404 sf sale that closed October 30th for $895,000 - so we thought we were still looking good, but no offers. 

The sellers don't have to sell, they have plenty of equaity and can afford the payments very comfortably.  But they found a bigger house at a great price in Carlsbad that they really want to buy - and that seller is tiring of waiting and wants to go fishing for another buyer.

 

 

Many sellers are not motivated to sell. They have an idea of what their house is worth. And they don't need to sell so they don't need anyone telling them their idea is wrong.

I have to hand it to Jim — he is persistent.

 

 

We had lowered to $799,000 in September, then $779,000 a couple of weeks ago, and then today to $739,000. 

 

 

Realize of course that in two or three short months the market is much worse. The house is declining in value. If you are the one trying to sell, you are better off doing a realistic appraisal of your own and listing below your neighbors. And whatever comparable houses sold for in the summer or whatever, that is hardly relevant today.

 

 

This is a tough market, and very humbling for me and other agents.  You can have all the comps, have the house look great, and market the home thoroughly - I've had ten open houses, did broker preview with lunch, and it's on 14 websites every other day. 

 

 

I am a big believer in the round robin, that exposes your house to the market and makes selling an event. If you positively have to sell, you should consider doing a "sell your house in 9 days" type sale. Get on my list first, please, and get my 25 page acclaimed report Keep Your Home, and begin getting my high quality (and sometimes quite startling) email information. Privacy is assured, and you can unsubscribe anytime.

 

 

Let's leave things with Jim having the last word. I think he says this superbly:

 

 

But if the price isn't right, then it won't sell.  The only way to find out what the right price is for the market conditions is to keeping lowering until you find a buyer.  Are we giving it away?  I don't know, but I haven't found anyone who sold in the last 24 months who has any regrets.