When to Reduce...And How Much???

If you’re a home seller in this current market, you may find yourself in a position of having to make a price “correction” (that’s realtors’ lingo for “reduction”) if your property doesn’t sell in a reasonable amount of time.  But, how do you know when to make that reduction…and how much to reduce?

The answer lies in knowing what’s happening around you and, to a certain extent, in personal motivation.  As many of you know, I am currently selling my own home.  This is something that real estate agents should have to do every once in a while…just to keep us humble and more empathetic.  Today, we took a big bite of the bullet and reduced our asking price by about 6%...this, after setting an initial asking price (about a month ago) that was already about 6% off of peak and well in line with a comparable property that just settled. 

So, why did we make the decision to go with a price “adjustment”?  For us, it is motivation.  We have built our dream home and it will be ready to be occupied in the next month or so.  We have also done extremely well with the property that we currently own and see no reason to be greedy.  We’re in a highly desirable area in downtown Bethesda and a part of me thinks that we could hold on and get close to our original price.  But, for us, life is too short.

So, the decision of when to “adjust” and by how much becomes at least partly personal.  It also is quite dependant on the original asking price.  If you start too high, you’ll certainly have to reduce (if you’re a serious seller) and that reduction should come sooner than later.  If you’re already at what you and your agent agree is “market” price and you’re willing to hold on, then you may be fine just waiting it out.  What you don’t want to do is to become the one chasing the market down.  You still want to be the best property that buyers see in your price range…and that will lead to a successful sale in any market.

Now, wish me good luck in selling our place!

Contributing Blogger - Gretchen Koitz

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