Posted on 09/02/2017 by Todd Pearce
Real estate agents are often asked why certain houses stay on the market for months and years while others, seemingly comparable, are sold within weeks.
Many inexperienced vendors overprice their properties out of a mistaken belief that this is the way to achieve the best price. Far from encouraging purchasers to make offers, overpricing actually discourages them. For a start, an overpriced property actually attracts the wrong market group.
If purchasers are used to seeing other properties that offer more for the money, they will give negative feedback. Not because the property is bad per se, but because of the way it compares with others in the same price range.
For a vendor leaving a reasonable negotiating factor of around five percent the optimum time to get the best offers is in the first few weeks - before the property becomes "stale".
After that inspections are likely to be fewer in number and many of these will be new purchasers coming on to the market for the first time. And the longer a property stays on the market, the more buyers feel they have the upper hand in any subsequent negotiations and will drive a hard bargain.
There are many stories about inexperienced vendors who turn down early offers because it is "too soon" or because they think they will do better later.
Vendors have plenty of time to regret their decision when purchasers lose interest and subsequent offers are lower or non-existent. There is nothing "wrong" with houses that are sitting around - except the price.
After all, even properties with serious issues like white ant damage end up finding buyers - if they're priced right."