A seller’s market with low inventory can prompt buyers to raise their offer price to beat out competitors. Unfortunately, even in a seller’s market an overpriced listing will linger. Buyers pay attention to time on market and may assume something is wrong with a property that has not received an acceptable offer, and gone “stale.” It’s critical to determine what time frame is considered stale in the current market.
Since the summer of 2017, there has been a market shift in northern Colorado. While the shift does not suggest a full blown buyer’s market, signs of more balance between sellers and buyers is apparent.
Price reductions have increased compared to the first two quarters of 2017. It’s not unusual to now see a $5,000 to $10,000 reduction in the early weeks of the listing if an acceptable offer has not been generated.
Soaring home prices may make buyers pause, but houses are still selling fast. Nationwide, the average time a home spent on the market was 34 days in September. This is down from 39 days a year prior, according to the National Association of REALTORS®.
Some sellers may be adamant about “testing the market” with a higher than substantiated asking price. This strategy found success in the seller’s market of recent years. Currently however, limited showing activity and lack of an offer within the first 2-4 weeks of listing strongly suggest that the list price has missed the mark.
Sellers receiving market feedback that the property condition or features don’t support the list price can reposition swiftly and increase the likelihood of a quicker sale. Savvy buyers are watching the market for price reductions, especially for homes that appeal to them and they have already visited.
Source: “How to Know When to Drop the Asking Price on Your Home,” CNBC (Oct. 27, 2017)
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