The housing market continues to show trends that it’s a great time to sell property. Demand continues to exceed supply, and homes are flying off the market. While today’s buyers are eager, they are also cautious. Certain old rules are holding truer than ever – homes initially listed for higher than market value are not selling, even after the initial price is dropped into line with the market. 

coming-soon-sold-lot-signComparison Shopping

If you’re working with a real estate agent, he or she will provide you with some price comparisons to nearby properties. With the countless real estate listing websites available, property owners can easily do their own comparisons without an agent. Of course, this also means your prospective buyers can do so as well – And they will.

In areas that are in particularly high demand, comparison should be done with homes for sale as nearby as possible. For example, while thirty year old homes in Bethesda on one side of Seven Locks Rd may be selling in the upper $700Ks, just across the road, similar homes may be selling in the mid $600Ks.

Feeling out the Market

Land owners understandably want to get the highest price they can for their property. But pricing that property too high above market value may result in no activity at all. You can’t negotiate with a potential buyer if they don’t make an offer in the first place.

Historically homes that sit on the market for a few months before seeing a price drop, create suspicions amongst buyers, agents and brokers. This is as true as it has ever been today. While a price drop might create renewed interest, it’s often only to ask “What’s wrong with it?” By that time the initial burst of interest properties see in the first 30 days on the market has been wasted.

Getting back what you put in

One piece of real estate wisdom that has become outdated is the idea that you can get back whatever you put in for home improvements. Potential buyers are no longer impressed that you spent $75,000 renovating the kitchen – They are only concerned that the price is $75,000 over market value.

In high demand areas such as Bethesda and Potomac, many older homes may be of interest to buyers who intend to tear down the existing home and build their own. Obviously these buyers are the least interested in any renovation work that may have been done. Consider if your home is a potential teardown before spending too much preparing it for the market.

List with Classic Homes

If you have raw land or a home with tear down potential, consider submitting the property to Classic Homes to be listed on our website. This is a free service that will put your property in front of thousands of prospects actively looking for land to build on. Fill out our Land Owners form or call our Sales Team at 301-256-4110 for more information.

 

References:

8 Reasons NOT to Test the Market with Your Asking Price
A realistic pricing strategy can reap you the highest reward when you sell your home
Trulia, June 2015

Five Signs Your Home Is Overpriced
Forbes, November 2002 

What’s ahead for the housing market in 2016
Washington Post, January 2016 

Signs of an Overpriced Home
SF Gate, Demand Media

 

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