Attention Home Sellers, Its Not August 2005 Anymore

Which phrase have you heard? (1) My agent was awesome. My house sold in the first week or (2) My agent did a terrible job, my house was listed for 90 days and did not sell.

Chances are you have probably heard both. I think real estate agents have always been quick to pat themselves on the back and take credit for something they had absolutely nothing to do with. On the flip side, the finger is aimed directly at them when a house does not sell. What’s the difference between the two? Why are some successful and some fail?

First, let’s look at recent history. You can say that the booming California residential real estate market peaked in August 2005. Prior to then you probably received a lot of mail from real estate salespeople sending out their self congratulatory promotional cards stating that the house “Sold in 3 days, above asking, multiple offers�. Now, how many of those cards have you received in the last 6 months? I’ll bet zero, nada, none. The reason is market factors, pure and simple…. supply and demand.

Current market conditions are going to determine the price for your home and how long it takes to sell it. When the cost of money was inexpensive and there were more buyers than homes available to sell, prices went up. Unfortunately, some home sellers still believe that their home is worth “x� number of dollars. These homes continue to sit unsold, while their “days on market� meter continues to run. If there has been no activity on a property in 6-8 weeks, its time to review the market analysis and probably make an adjustment to at least get people to look at the house. This usually means a price reduction of 2-3%. What does Macys do with last season’s fashions? They reduce the price and get rid of it.

I know I am in for a difficult listing presentation, when a home seller says to me “I need “X� amount of money from my house sale�. Since when did a buyer or the housing market become concerned with your finances? The house will sell for what the market says its worth.

Our listing agreement states that the ultimate decision on what to list a house for is up to you, the seller. My job is to advise and recommend a price to you, reflective of the current conditions within the market. You have two options. You can price it to sell or price it to sit. If you price it to sell, we’ll proceed to escrow. If you price it to sit, I’ll see you at Macys.