Reality check!!! Today’s post is about buyers and sellers with unrealistic expectations and my attempt to bring them back to reality. I chatted with a coworker about my plan to post this topic and she said “You can’t talk about that. Your clients will get upset with you and probably switch agents.” I disagree. I believe it’s my job to educate my clients. Buyers and sellers with unrealistic expectations are usually just misinformed. I also believe some clients cannot or don’t want to be educated and there may come a time when I have to let them go.
Let’s start with buyers. There are definitely some great deals to be had right now. Each day when I browse the MLS I find a handful of homes that I add to my “favorites” list. These are primarily homes that are priced incredibly well or that are very unique. Inevitably, these are the homes that are selling. I also still run across new listings that make me think, good luck! I ignore those and wait for price reductions. Buyers are correct to think that in this market they can get more for their money and they can ask sellers and builders to throw in extras they might not have gotten a couple of years ago.
Now buyers, listen up. It does not mean that if you can afford to spend $600,000 I’m going to waste everyone’s time by showing you $1,000,000 listings so you can write a low ball offer because you think the seller should feel lucky to get even that much in this market. Some buyers get hung up thinking that if they can’t get a house for significantly less than the asking price, they’re not getting a good deal. The reality is, right now, sellers have to price their homes very competitively to even get showings. Some sellers are so serious they’re listing their homes at their absolute rock bottom price in order to sell quickly and in turn, they are getting FULL PRICE OFFERS. You heard me correctly. Sellers are still getting full price offers for well priced homes. Rest assured that I watch the MLS like a hawk. When we look at houses I’m only going to show you the best values. Why waste time seeing the overpriced listings? Sellers with overpriced listed are not motivated sellers. You might think you can offer them much less and they’ll take it but the truth is if they really wanted to sell, they’d reduce the price. In this market, sellers with overpriced listings are still dreaming and your lowball offer is only going to make them angry.
Now for you sellers. You probably can’t sell your home today for as much as you could have a few years ago. Even worse, if you bought your home in the last 5 years, you will probably have to sell your house for less than you paid for it. If you are unable to accept this reality and you don’t absolutely have to sell, why not wait? Homes values in Central Oregon will go up again. By waiting awhile, you’ll be more likely to get the higher price you want. By listing your house too high because you want to see what happens, you’re contributing to the high number of days on market and giving the media more ammunition for their negative coverage of the real estate market. While it may or may not be true, many buyers view every price reduction as you becoming more and more desperate. Also, the media loves to report that all the price reductions mean plummeting home values when in many cases, it simply means the house was overpriced to begin with and after a few reductions, the house is finally at true market value.
Another big mistake is to price your home based on how much money you think you need to make. That has never determined the market value of a house. If you’d like to walk away with $100,000 in your pocket but at the list price your agent recommends you’ll only make $50,000, you’ll have to wait until your home appreciates more. Buyers are not going to pay too much for your house because you need to make a certain amount of money. Buyers do not care how much you paid or how much you think you need to walk away with. They only care about getting a good house for a good price and that they’re not paying too much.
For those of you that are motivated and serious about selling, please listen to your real estate agent. The statistics they will show you from the MLS do not lie. It’s human nature for home owners to think that their home is much nicer than the identical home that just sold down the street. If your home has the same floor plan, same amenities, and same lot size, it should be the same price! Trust me when I say that the fresh coat of paint you applied does not mean you can list your house for $20,000 more. Buyers in this market expect fresh paint. Another tip is to fix everything that needs to be fixed. Don’t give allowances or credits for repairs because a buyer will simply find another house in their price range that doesn’t need extra work. The one exception might be carpet. Buyers do like to pick out their own carpet but they will probably want it to be installed before they move in. As difficult as it may be, you must stop thinking about the house you’re selling as YOUR house. It is now a product you’re trying to sell. Try not to be offended by the negative feedback you receive. Instead, use the information to your advantage! You want your house to stand above all the others in your price range and buyers are sharing information that will help you achieve this! Listen to what they’re saying, discuss it with your agent, and consider making those changes.
Good luck to all of you trying to sell right now. And to all of you buyers on the fence right now, help a seller out! Make some offers and let’s get this market moving again!