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Reducing the selling price on your property


Lowering the price of your house for sale is a decision no one wants to make, but buyers will be instantly attracted to your home when you do so. When the current real estate market is going through a cold or sluggish period, you will often find heated discussions between house sellers and their associated estate agents on why a home hasn’t sold.  The sellers blame the estate agents, and the agents tell the seller their sale price is unreasonably high. If you are selling your house it is not a bad thing to question your real estate agent about whether or not they are doing their utmost to sell your property.

Don’t reduce your home’s sale price until you’ve asked your estate agent (and yourself) these ten marketing questions:

1. How many advertisements have been created for my real estate listing? Where were they published, and will they be repeated?

2. How much related information about my home have you put into these advertisements? Could you be over or under-doing it in terms of the amount of text or depth of description?

3. Have you created a direct mail marketing campaign for my home? Which media are you using, E.G. pamphlets, post cards, flyers etc.?

4. How many open for inspections have you had on the property, and are you bringing through potential buyers at other times?

5. What do your online advertisements of my home look like? Do you use a lot of high quality photos?

6. What kind of signs are you using to market my house? Are they large, colour, and placed in a location where the viewing public can see easily? Do they have your real estate agency’s website address on them? What about several phone numbers of the affiliated estate agent(s), just in case a buyer can’t get through to one?

7. Does my online advertisement come with a virtual tour of the property, together with audio and clickable text? If not, how much would I have to pay to get this added to my marketing plan?

8. What have fellow estate agents and potential buyers you’ve related with thought about my home? Is there a general consensus I’m unaware of?

9. Am I offering my estate agent enough commission? What are other estate agents in the area receiving, and was I too tough in my initial negotiations?

10. How many proper showings have been held at the property? Is this enough?
Is the current ‘cold’, or buyer’s real estate market sapping your motivation for selling a home?

Ask yourself if it is truly necessary to sell your house at this time. When times are tough and supply of homes is higher than the demand for buying them, it could be in your best interest to forget price reductions altogether and take the house off of the market. If you do keep a home that is priced relatively high on the market, you may get no interest whatsoever, and this in turn makes overall market conditions look even worse.

If you don’t have to sell right now, consider renting out the home, or waiting to put the home onto market once conditions have ‘warmed’ up. The main rule to consider is sellers need to adjust their actions and goals in relation to the current market conditions. You don’t want to be the person who has a sign indefinitely in front of their home, but with nobody interested in taking a tour inside.

Choose the most suitable house price:
The general rule of thumb is if you price the property too high, you risk the fate of 90repeatedly having to reduce the price in order to meet buyers’ expectations. After these reductions are made, people will become dubious about your home’s quality, and will wonder if you are willing to go even further down.  If you are in a situation where a price reduction is deemed necessary, the best result you can hope for is a single drop in price. Here are five tasks you can partake in to ensure you won’t need to lower your sale price more than once:

1. If the relationship with your estate agent has been strained because of not selling your house, you need to realise they also want a positive result. If you work together you have a much better chance of success, especially as the estate agent is an expert in the field. It would be wasteful not to utilise their skills.

2. Do research on other pending real estate sales in your area. How long did each home sit on the market before the price was reduced? As they are pending you won’t be able to learn the final selling price, but you can collate the information to discover the average percentage sellers are dropping their prices.

3. Do price comparisons between recently sold homes and current listings on the market. Find out which ones are selling for more and adjust your price accordingly.

4. Also research the history of current homes on the market. How long were they for sale before their price was reduced? Don’t bother looking at homes that haven’t had their price reduced unless they have strong similarities to your own home, and they’ve only been on the market for a very short time.

5. Compare your home with similar properties selling in the same price range. Ensure your sales price falls at least in the cheaper 40% of listed homes, but if you are in a real hurry, make it cheaper than all of the competing houses.

Could my house price be set too low?
This is not an issue you want to be too concerned about. Even when a market is cold and general home prices are decreasing at an exponential rate, buyers will always have their eyes out for a house priced below what they are hoping to pay. If your home is cheaper than its competitors, it’s only natural you’ll receive numerous offers from different people. Once attention has been grabbed, the potential buyers attempt to outdo each other’s offers, paradoxically often resulting in the home selling for more than the original sales price, which was ‘too low’. When selling property, all houses sell if the sales price is on the mark.
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