Ask a Broker: Is it still a good time to sell?
Ask a Broker
Question: A few of our neighbors sold their houses for insanely high prices and we were thinking of cashing in. Is it still a good time to sell?
The market is in a very different place now than it was six months ago. Since the end of the ski season, there has been a significant shift. Between May 1 and the end of August, total sales in the Vail Valley are down 36% as compared to a year ago and inventory is increasing; two variables that indicate we are experiencing a market adjustment. The market is still strong, but we are returning to relative normalcy. For sellers, this means the heyday of multiple offers, heated prices, and the unprecedented buying frenzy we experienced is over. If your property is very special with a unique location, you may still see multiple offers.
A few rules of thumb for sellers in today’s market.
When it comes to pricing, listen to your broker, not your neighbor.
Overpricing will cause your property to languish, which is not ideal when inventory is rising. There are now enough options out there that buyers can be more discriminating. If your list price is too high, you risk losing those motivated buyers who understand the market and are prepared to make an offer on properties that are priced right and check their boxes.
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A list price is not a comparable price until it is sold.
This is especially true in the current market. Look at the most recent sales and other available properties, not what your friend or neighbor fetched on their property 3-6 months ago. Lean on a real estate professional to provide the most accurate and current information on the local market, not online platforms like Zillow which use generalized algorithms that don’t give accurate readings.
Don’t list high by rationalizing you can reduce the price later.
These days, if a buyer sees a property on the market for more than two weeks, they wonder “What’s wrong with it?” Today’s buyers are educated. If a property sits too long, they know it’s overpriced or the condition is lacking. The last thing you want is for your listing to get stale.
A general rule of thumb is if you have not seen an offer after 10 showings, adjust your price.
Those first 10 showings are key and should tell you quite a bit about your property’s condition and pricing. If you are a serious seller, don’t wait to adjust your price. Your home is not as exciting to buyers as when it is fresh on the market.
When you do adjust your price, make it significant.
You want your price drop to generate excitement, something to get your listing back in the game. A bigger reduction is going to cast a broader net. Don’t try to chase the market down with a series of small adjustments, do it in one swift and bold move.
The first buyer is usually the one who is most motivated. Unless the offer is ridiculous, start a conversation and be willing to negotiate.
There’s an old saying in real estate, “the first offer is the best offer.” Typically, the first offer is coming from someone who is ready to pull the trigger. They know the market, they know what they’re looking for, and they have the means to lock it up. Be prepared to start a dialogue. There should be a way to work it out between a reasonable seller and a reasonable buyer.