Do I Need to Lower Price or More Aggressive Selling?

emilynewhomeApril 21, 2010

Our home has been on the market approx 3 months, we had 3 showings in the 1st month, positive feedback, no offers! There are no comps for our neighborhood so the Realtor suggested the price, based on cost to build. (This is a custom home neighborhood, a couple lots still available $110K and up)

Last week I contacted our Realtor and asked what was happening with our listing, he apologized for the neglect, but his mother had died and he had been preoccupied.

He has scheduled a meeting with us for tomorrow "to see what suggestions we can come up with"! DH thinks Realtor is going to suggest lowering the price. We will be eating the cost of 5% commission at the already asking price!

We are wondering how much of a price reduction should we concede to? Should we ask for more aggressive advertising? More online photos, advertise in local paper? (His broker advertises on Trulia, plus a local Realtor magazine and the Realtors 'For Sale' sign with flyers)

Appreciate suggestions, thanks!

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Welcome to 2010. If you recently built a home and now need to sell, you are likely going to lose money.

As for pricing.... there are comps. If your agent can't provide a list of homes that have sold recently then you need a new agent. People who would consider buying your home aren't just going to look around your golf course.

Once you get a list of the houses that have sold recently, you should be able to compare your house to those and set an appropriate price. I hate to tell you, but it is going to be significantly less than the cost to build. The whole point of building your own home is that you get to pick everything from layout to finishes and have it exactly how you want. You pay a significant premium for that.

BTW - I think your house looks great. However, the luxury home market is in the tank pretty much everywhere. If you really need to sell, you are probably going to take a big hit.

    Bookmark   April 21, 2010 at 10:53AM
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I looked at the other existing homes your realtor has listed on their website, and right below your house is one currently under contract that is located at the same golf course, has 85 sq ft more space (3283 sq ft vs 3198 sq ft), is 4 bedroom 3.5 bath, whereas yours is 4 bedroom, 2.5 bath. You are listed at $669,900 and this other house that is bigger than yours on the same golf course is listed at $495,000. I think your realtor is not giving you good pricing information unless there is something massively wrong with the other house that is not being disclosed.

Here is a link that might be useful: Realtor's other homes

    Bookmark   April 21, 2010 at 11:16AM
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I agree with setancre. Your house, while very nice, seems overpriced in comparison with the larger house under contract in your subdivision just over 1/2 mile away from yours. Is there a reason that isn't evident from the listing as to why your house is listed $175,000 higher than the one under contract? Or more importantly, is there a reason that a buyer would want to pay that much more for yours?

    Bookmark   April 21, 2010 at 11:51AM
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Yes 'setancre' and 'bethesdamadman', we agree, that is why we called our Realtor.

I have driven by the other house which has a smaller lot,and backs up to street. It is located in 'Blue Sage' (withing the Graywood Planned community) an older neighborhood with homes ranging from 2400 sqft up to 3400 sqft all with smaller lots.

Our home is in 'Indigo Pl.' homes 2800 sqft to no limit. Ours is the smallest in our division, homes are still being built most 4500 sq ft and up.

The Graywood subdivision is divided up into 'neighborhoods' w/minimum sq footage for homes and the lots are priced accordingly!

The difference in price is in mostly the unseen/unnoticed, such as foam insulation, 50 yr shingles, aluminum clad windows, higher end appliances/fixtures throughout, emergency generator etc.

We are in a quandary as to how much to reduce the price, and how much more to ask of our Realtor!

    Bookmark   April 21, 2010 at 12:43PM
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Those are all valid reasons for your house being listed at a higher price point, but is it reason enough for a buyer to justify spending $175,000 more for your house? So far, the answer has been no.

When we moved to a country club golf course community, we were told that appraisers here add a $100k premium to lots on the golf course over lots backing to a street. YMMV.

Hopefully, you and your agent will agree on a price that will lead to more showings, and ultimately to a signed contract.

    Bookmark   April 21, 2010 at 1:08PM
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How come the items you mentioned aren't highlighted in the listing. It sure would make somebody looking see what the difference is, because the pics doesn't show it. Besides the neighborhood part being different, which I assume buyers in the area would already know.

It does seem though that you are still overpriced as the size might be too small for those looking at houses in your price range. Generally it is good to have the smallest house in the neighborhood vs. the largest as you'll get more per sq ft, however it usually tends to be less than some of the larger homes still as others will be looking at much lower priced homes with similar sq ft in other areas too and that is who would be looking at your house.

BTW how's the pre-approved part working out as far as showings. You might want to ask your realtor if that has been a limited factor too. There are cash buyers too. Also you need people to come in and see the place. The listing doesn't show the house as something special as compared to a few others.

I doubt you'd have too many people coming through that weren't serious about buying with an agent as I doubt agents wants to waste their time on those people anyways when they could be out making money.

    Bookmark   April 21, 2010 at 1:58PM
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I think you seriously need to consider a new agent!!! Then you need to decide if you really want to sell, then be prepared to lose money, or take it off the market and enjoy your beautiful home!! I agree with 'bill' "if you recently built a home you are likely going to lose money."

    Bookmark   April 22, 2010 at 11:02AM
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I agree the listing doesn't really say much about why your house is special. Is it really on the golf course? If so, I would play that up more in the listing.

It does sound overpriced nonetheless. What about comps outside the golf course nearby? What about other golf course communities that are similar?

    Bookmark   April 22, 2010 at 8:34PM
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Well, we lowered the price and our Realtor rewrote the listing!
Here's hoping a qualified buyer is looking for such a home!
Thanks everyone for the advice!

    Bookmark   May 4, 2010 at 12:01PM
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When you aren't getting showings I don't think I understand the restriction on pre-approved buyers. I have a house for sale in a similar price range and I have placed no such restriction. I want people in there looking and lots of people aren't going to get pre-approved to look even though they may easily be able to get pre-approval. Or, they could be like us -- we have already bought our new house but paid cash so we had no pre-approval.

Of course, before signing a contract it would be entirely reasonable to ask for pre-approval.

I gather that there is still new construction going on. If so, you will likely need to be priced below it to get much interest.

    Bookmark   May 4, 2010 at 1:59PM
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