Warning! This is going to be a candid real estate conversation. If you are squeemish, stop reading now!
The real estate business is tough, extremely competitive, and often cut-throat, and the key to success for agents is “get the listings”! Innocent sellers often get caught-up in a game without knowing it — a game called “first get the listing and get the price down to where it should be later”. How does that happen to sellers? It happens when sellers do exactly what they should do when they decide to sell. They call two or three different agents to get opinions of the current market value of their property. Unfortunately, the sellers most often do not really listen to what the agents say and they almost never ask the agents to “show me the comps” — “show me the specific sold properties upon which you base your opinion of value for my property.”
Instead, sellers all too often fall into the trap of listing their property with the agent who quotes them the highest value without substantiating that value! “Tell me what I want to hear, and I’ll list my property with you.” Big, big, big mistake, especially here in the northern Door County real estate market which has very long market times. Right now the average number of days properties are on the market before selling is 643 days! Do you want to go into that market with an over-priced property?
When you make the decision to sell, presumably you mean sometime soon, not two or three years from now. Pricing is the most important factor in achieving that goal. Here are the reasons why:
- The ratio of properties for sale to the number that will sell this year is about 3 to 1 — lots of competition. An overpriced property is not competitive.
- When your buyer’s lender has your property appraised before approving the buyer’s loan, the appraised value must meet or exceed the agreed upon sale price. So even if you are very lucky and get an offer higher than your property’s true “current market value,” the sale could fall through because of the appraisal.
- Back to that “first get the listing and get the price down to where it should be later” game. Your property has been on the market for a few months when your listing agent suggests a price reduction. For those months all the buyers looking at properties in the price range where your property should be have not looked at it because it isn’t in their price range. The buyers who have looked at your property rejected it because it doesn’t meet their expectations. The wrong buyers are looking at your property!
The moral is, when the agents you interview give you their listing presentations pay attention. “Your property is so wonderful that I just know I will sell it for $___!” just doesn’t cut it. Take off those rose-colored glasses, ask to see the comps, and ask questions! Look at the market and your property through the eyes of the buyers. The agent who demonstrates a thorough knowledge of the real estate market and can justify the value of your property with facts and figures — actual market data — is the one to trust.
When you call me or any agent at Wilson, Inc. Real Estate to talk about selling your Door County property, we will provide you with solid sales data and an honest market value and recommendation for a listing price. Nothing less will do.