If your real estate property is sitting in the market for a considerable number of days, it is time to make some changes, like reducing the price. You may notice that not many people are showing up on the open house dates. It is hard to even accept that your house is not what you thought to be worth. Remember, that prices of properties are determined by buyers, so when the market condition is favorable to them, demand for housing drops, so does the price. The big question here is: how long to wait before reducing the price of your house? There is no magic formula, but the houses for sale in your area will give a clue. Ask your real estate agent the reasonable number of days a house can be in the market. If yours already passed that number, then it is about time for a price reduction.
The price that you set at the beginning may have been appropriate but it is the buyers who will ultimately decide how much your house will be sold for. The buyers are simply telling you that they are not willing to pay the price you set. Historical pricing may have been a good indication but it is bound with imperfection. Only time and market in the current condition can make or break the deal. Similarly, you may notice “Price Reduced” signs in your neighborhood which is another indication that the best time is yet to come. To figure what is really happening, ask your agent to run another comparable analysis. Visit local open houses and find out the difference between those houses and your property as well as the features that justify the price in each. Finally, ask agents their honest opinion about the house and to come up with a price that is comfortable to buyers.
If you discover that what agent suggested is too low for your bottom line, consider other alternatives, like renting the house for a while until the market stabilizes or improves. You can offer a residential lease or month to month rental … agreement terms to your would-be tenants. Meanwhile, it is an opportunity to earn some money that you can use to upgrade the property or compensate for the lost profit.
Maybe the tenants will be interested in your house and ultimately buy it for a price you are asking for, who knows? Remember that whatever price you set at a later date should be big enough to grab buyers’ attention. This is especially required if the house has been in the market for what you or the agent considered too long. Setting the price too low will make them think that there are hidden problems in the property. Setting price too high will turn them away. Of course, slashing the price considering the fact that you spent a lot of time and resources in the house may be emotionally difficult for you. However, know that the lower the price, the faster the house will sell.