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Why home sellers are stuck on high prices
All across the country, real estate agents are having difficult conversations with home sellers who can’t quite accept that they won’t get the same price a neighbor did several months earlier.
Realtor.com® data confirms sellers’ worst fears, with the median national list price declining from an all-time high of $449,000 in June to $417,000 in November, according to our most recent monthly report. What’s more, the share of listings with price reductions grew from 9.4% last November to 19.6% this year.
It is really hard for sellers to adjust to this market. Homeowners are basing their expectations on past information that’s still out there. In the housing market, the past is still with us in a way that is psychologically and emotionally confusing.
Conditions are different now and it’s better for you to accept that when your real estate agent tells you than to learn it the hard way, by having your home sit on the market for some time. Because the longer your home sits on the market, the more reluctant buyers will be to take a look—and the cycle spirals downward from there.
Real estate agents often act as therapists for people getting ready to make one of the biggest financial moves of their lives, and the upheaval of this market calls for some serious counseling.
Consider a Plan B before you execute on Plan A
It’s always a good idea to think about a backup price if your original asking price doesn’t come through, but perhaps never more so than during a market in transition like this. You’ll probably find your real estate agent thinks it’s a good idea as well. Consider changing the price after a certain amount of time.
Look at multiple data sources for pricing consideration
Perhaps the best way to price your home is to look at similar homes that have sold recently. But right now, you’ll probably also want to evaluate current listings to see your competition. Look at listings that were pulled off the market to see if there are patterns with those properties.
Don’t take it personally
Do get used to homes not selling immediately. Sellers need to get back in the mindset that selling in a day or an hour is not normal. If mortgage rates were still 3% or 4%, buyers would be knocking down your door. This is just the way the market is right now.
Adjust your price quickly if you’re not getting any interest
While leaning on your agent’s expertise is always a good idea, even the pros don’t always get it right.
The interest rate environment has not only changed, it continues to change. The mood of the consumer is changing quickly. People are frozen in place, is what we are seeing.
Bottom line: It’s best to set the correct price initially. However, if you don’t, then act quickly and decisively to get it right the second time.
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