It’s a challenging home sale market for sellers in many areas around the country. Sellers who are having difficulty selling have several options.
The first goal is to find out why your home isn’t selling. Ask your listing agent for information about listings similar to yours in your neighborhood that sold within the last three to six weeks.
You need to know the facts about listings that have sold and closed and those that went pending during this period. A pending sale is one where the sellers have accepted an offer, but the sale has not yet closed.
Pending sales are an indicator of the most recent market activity in your price range. If you find that listings like yours have sold during this time period then there is either something wrong with your home or your home isn’t priced right for the market.
Your agent should talk to agents whose buyers considered your home but bought another listing instead. Find out why they didn’t choose your home. If you get feedback that your home doesn’t show well, do what you can to enhance its appeal. You might consider temporarily withdrawing your home from the market during the makeover.
You may discover that your home has an incurable defect, like a location next to a freeway, or a long flight of stairs from the garage to the front door. There’s nothing you can do about this except adjust the price.
In many cases, the main reason a home isn’t selling is the list price. Most sellers have an emotional attachment to their homes. This can cloud their judgment about its current market value. Another factor influencing sellers’ objectivity about the value of their homes is denial.
According to the recent Q4 Homeowner Confidence Survey conducted by Zillow.com, 49 percent of U.S. homeowners didn’t think their homes lost value during the past year. In reality, 74 percent of U.S. homes lost value over the past year.
HOUSE HUNTING TIP: Sellers who are serious about selling should adjust the list price of their home as soon as the data indicates that the price is out of line with current market conditions. This is recommended even if the listing has been on the market only for a couple of weeks.
It’s risky to wait to make a price adjustment to see if conditions improve. The market is continually changing. But, this means that the market could deteriorate before it gets better. Waiting to bring the price down so that it’s in line with the market could mean selling for less.
An insignificant price reduction is unlikely to trigger a sale. To have an impact, the new price should undercut your competitor’s prices so that your home is perceived as the best value in the neighborhood. Usually, a price reduction of less than 5 percent won’t bring about the desired result. Seller’s who make a series of small price reductions can end up chasing a declining market.
Another option for some sellers is to take their home off the market before the holiday season and bring it back on the market next year. But, the holiday season can benefit sellers who keep their homes on the market because the inventory of listings usually drops off at this time of year. If your home is priced right, and is one of few available, you may have a better chance of selling.
THE CLOSING: Also, there is no guarantee that next year will be better. Some economists think that we haven’t yet hit bottom in the housing cycle and that the median price could drop another 10 or 20 percent in 2009 before the market turns around.
Dian Hymer is a nationally syndicated real estate columnist and author of "House Hunting, The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer’s Guide," Chronicle Books.
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