Though low inventory is prompting buyers to raise their offers in order to beat out competitors, sellers still must know that an overpriced listing will linger on the market. Most buyers, whether through their real estate agent or through their own internet surfing, are aware of where pricing should fall for homes in their search criteria.
When selling a home, it is critical for your Realtor to stay on top of the market. A few key things they should take into consideration are if the initial upsurge of showings has slowed or become non-existent, whether the feedback has reflected that a price reduction is in order, or the time frame in which the home has been on the market shows it is in danger of becoming “stale” in the eyes of prospective buyers. In the “Quad Cities” area the average days on market are 55, for Prescott 70, Prescott Valley 32, Chino Valley 61 and Dewey-Humboldt 53 (statistics from Prescott Area Association of Realtors as of August 2, 2018).
Soaring home prices may make buyers pause, but homes are still selling fast at this point. Some sellers may be adamant about “testing the market” with a high asking price, but your realtor should have a game plan for what to do if that strategy backfires. Bella Terra Realty doesn’t advise just “testing the market” but if we enter the market with a list price pushing the top of the range, we can easily gauge response within 7-10 days. It’s almost a certainty that if we don’t get an offer within that first 10-day period, then we’ve missed the mark and a price reduction is in order. We typically encourage a price reduction after the second week on the market, after analyzing and determining that the home price is the problem.
Doing a rapid price reduction can result in a quicker sale by potentially bringing back those same buyers who liked the property in the first place and also may view the price adjustment as an indication that the seller is listening to their Realtor’s advice and the marketplace. Sometimes Sellers want to price their home, believing that people like to negotiate, and they want to have room to do so. In the Prescott Area Association of Realtors MLS, the average sold/list price is 98%, 98% in the “Quad Cities” area, 98% in Prescott, 99% in Prescott Valley, 99% in Chino Valley and 98% in Dewey-Humboldt (as of August 2, 2018). Those statistics indicate that Sellers are not seeing a lot of price negotiation from their list price.