6 Reasons To Reduce Your Home Price
By: G. M. Filisko
Published: March 19, 2010
While you'd like to get the best price for your home, consider our six reasons to reduce your home price.
Home not selling? That could happen for a number of reasons you can't control, like a unique home layout or having one of the few homes in the neighborhood without a garage. There is one factor you can control: your home price.
These six signs may be telling you it's time to lower your price.
1. You're drawing few lookers
You get the most interest in your home right after you put it on the market because buyers want to catch a great new home before anybody else takes it. If your real estate agent reports there have been fewer buyers calling about and asking to tour your home than there have been for other homes in your area, that may be a sign buyers think it's overpriced and are waiting for the price to fall before viewing it.
2. You're drawing lots of lookers but have no offers
If you've had 30 sets of potential buyers come through your home and not a single one has made an offer, something is off. What are other agents telling your agent about your home? An overly high price may be discouraging buyers from making an offer.
3. Your home's been on the market longer than similar homes
Ask your real estate agent about the average number of days it takes to sell a home in your market. If the answer is 30 and you're pushing 45, your price may be affecting buyer interest. When a home sits on the market, buyers can begin to wonder if there's something wrong with it, which can delay a sale even further. At least consider lowering your asking price.
4. You have a deadline
If you've got to sell soon because of a job transfer or you've already purchased another home, it may be necessary to generate buyer interest by dropping your price so your home is a little lower priced than comparable homes in your area. Remember: It's not how much money you need that determines the sale price of your home, it's how much money a buyer is willing to spend.
5. You can't make upgrades
Maybe you're plum out of cash and don't have the funds to put fresh paint on the walls, clean the carpets, and add curb appeal. But the feedback your agent is reporting from buyers is that your home isn't as well-appointed as similarly priced homes. When your home has been on the market longer than comparable homes in better condition, it's time to accept that buyers expect to pay less for a home that doesn't show as well as others.
6. The competition has changed
If weeks go by with no offers, continue to check out the competition. What have comparable homes sold for and what's still on the market? What new listings have been added since you listed your home for sale? If comparable home sales or new listings show your price is too steep, consider a price reduction.
More from HouseLogic
How to ready your home for sale at little cost (http://buyandsell.houselogic.com/articles/5-tips-prepare-your-home-sale/)
How to review offers on your home (http://buyandsell.houselogic.com/articles/6-tips-choosing-best-offer-your-home/)
Other web resources
Setting the right price
More on setting the right price (http://public.findlaw.com/abaflg/flg-4-4a-1.html)
G.M. Filisko is an attorney and award-winning writer who made strategic price reductions that led to the sale of a Wisconsin property. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.
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Wichita Named Most Uniquely American City
Wow! Wichita has been named the nation's "most uniquely American" city by Newsmax
magazine. The magazine hired Peter Greenberg, travel editor for NBC's
Today show, to rank cities that "embody America's core values."
Greenberg graded communities in nine area - hospitality, wholesomeness,
family-friendliness, business-friendliness, devotion to religion,
culture, community activities, scenic beauty, and education. Quoting
from www.newsmax.com/cities: "This is one of America's most livable
cities, with a historic downtown that helps bring the community
together. The city's affordability, thriving industry, and accessible
culture are the bonus elements that make it stand out from the crowd.
The city has done an amazing job transforming Old Town from abandoned,
turn-of-the-century warehouses into a vital commercial and social hub.
On the last Friday of each month, you can even hop on street trolley to
travel between galleries and museums." Wichita is a great place to be!
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Spring Parade of Homes Dates Announced!
The Spring Parade of Homeswill be held during the following dates: April 18 - 19; April 25 - 26, and May 2 - 3. Come see the beautiful model homes that Wichita has to offer!
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More Information on First Time Homebuyer Tax Credit
* $8,000 Tax Credit - up to 10% of home purchase price, capped at $8,000
maximum.
*First Time Homebuyers - defined as those who have not owned a
principal residence during the last 3 years.
* 2009 Buyer ONLY - eligible
home purchases must occur after Jan 1, 2009 and before Dec 1, 2009.
* Income
Limit - $75,000 adjusted gross income for single buyers and $150,000 AGI for
married couples. Higher incomes - up to $95k single/$170k joint - may qualify
for reduced tax credit.
* Refundable - unused portion of tax credit is
refunded to homebuyer by the IRS, if they owe less than $8,000 in
taxes.
*Recapture - if home is sold within 3 years of purchase, the entire
tax credit will be returned to the government; one home ownership exceeds 3
years, there is no longer any recapture liability.
*Repayment - NONE!! this
credit is not a loan to be repaid, like the tax credit offered in 2008.
*2008
Tax Return - this credit can be claimed on your 2008, 1040 filed by April 15,
2009 - IF the home was purchased after Jan 1, 2009.
Thank you to Gene Pulliam at Bank of America.
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Should We Offer a Carpet Allowance?
Question of the Day: Should I Offer A Carpet Allowance in order to get my House Sold?
This is a great question from many home seller's. It actually is a great thought if you have carpet that is in pretty bad shape or if the carpet is dated (another way to say "not neutral"). Here is my opinion: a carpet allowance simply doesn't have the effect most sellers think it
would.
Here is how the typical conversation goes with my seller clients:
We're frustrated that we haven't received any offers, even though we have had 10 showings! What would you think of adding a $5000 carpet and paint allowance to the
listing? The number one thing that seems to be consistently noted in our showing
feedback is how “outdated” and/or poor condition the carpet is, so
I would like to try and address this directly. While I don't understand why people don't like our wallpaper, the $5,000 could cover that as well. Somehow I want to get the point
across that we acknowledge the carpet and wallpaper. However, instead of us presuming we know
what carpet a potential buyer would prefer, we would instead prefer to give the
buyer the choice on this as part of the sale. I am a little amazed that so many potential buyers cannot get past the carpet and seem to think that replacing the carpet
and doing some simple paint work is some sort of heavy duty remodeling effort. However, based on the feedback we have received, this appears to be the case. I think making some sort of attempt to address this directly rather than simply
through the price itself might be a good marketing
move. What do you think?
Here is my response:
I understand your frustration. But instead of the carpet/paint allowance, I would like you to consider a different option. Consider doing a 90 day, same as cash type deal to put brand new
carpet in…or even get (the carpet guy) to put some cheap carpet (but decent
looking) in and just pay for it to get it in the house.
Unfortunately,
with all my years of selling, even the allowance will not get them past picking
your home. It is truly a “beauty contest” AND a “price war” and you have to win
both. Obviously the price is not keeping them away…we are getting some decent
traffic.
Even a cheap new carpet is still new and looks great. A neutral,
light color is important. But also understand that if you do change the carpet,
you may still want to get some neutral paint colors on the walls. Really, I
think both will work great together in that home, and you will definitely see a
return (by getting more for you home than if you don’t do it).
Remember, buyers are comparing your home to not only resale homes, but also new construction. It's hard to win the beauty contest when your carpet isn't fresh and your wallpaper makes the home appear dated. It's a win-win for both sides: you get your home sold at a better price, and the buyers get a fresh, move in ready property.
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A Special Thank You to David Foley, DDS, and Staff
A special "thank you" to Dr. David Foley and his terrific staff for the Zoom whitening system he donated to the Gary Paul cause. Gary Paul is a local real estate agent here in Wichita, and he is facing a life-threatening illness. He needs a lung transplant, and the Wichita Thunder sponsored an Gary Paul evening benefit. Dr. Foley donated a Zoom treatment, and I won! Wow! Pretty excitiing. I am happy to report that the treatment was a hugh success - I now have a beautiful blinding white smile. Dr. Foley was terrific, and his staff was kind and professional. I so appreciate the treatment, and want to personally thank Dr. Foley for his gracious donation to Gary. If anyone wants a beautiful white smile, I highly recommend Dr. Foley! |
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$8,000 Tax Credit
Want an extra $8,000? If you’re a first-time homebuyer, here is some great news!
Last fall, the Federal Government introduced a financial incentive to prospective first-time homebuyers — an income tax credit of up to $7,500. The rules were simple: you must have been a first-time homebuyer (as defined by not owning a home in the previous three years) and you met certain income restrictions.
The new $8,000 tax credit is available to those who buy between January 1, 2009 and December 1, 2009. It’s not a deduction; it’s an actual credit. Here's how that helps you - if you were going to receive $500 back on your taxes, if you bought a new house, you would receive $8500! And, unlike the $7,500 first-time homebuyer tax credit introduced last summer; this does not need to be repaid.
First timers who qualify can make no more than $75,000 in adjusted gross income if they’re single or $150,000 if filing jointly. The maximum tax credit is $8,000 or 10 percent of the sales price of the home, whichever is less. Three years residence in the property are required. As always, check with your accountant for details and be sure to submit IRS form 5405when you file your taxes.
For more information, see the New Buyers tab on my website. Or call me for additional information - I'm here to help.
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MLS Statistics for January
The Wichita Area Association of Realtors has published the following information about sales and listings for the month of January, 2009:
Sales
2006 2007 2008 2009
January 692 692 598 413
February 833 735 709
Listings
January 1,579 1,380 1,216 1,187
February 1,233 1,112 1,112
Wichita sales slowed in January - we are looking forward to the stats from the Wichita Area Association of Realtors for February. What is clear - if a house is priced correctly, it will sell. Average days on market in January for resale homes was 73. |
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First Time Home Buyer Information
| If you are a first-time homebuyer, you are eligible for an $8,000 tax credit. See the informational tab under "1st Time Buyers" for detailed information. |
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Open Houses
| Just scheduled an Open House for 9206 E Clark for Sunday, March 22nd from 2-4 pm. If you haven't seen this adorable home, you are really missing something. This beauty has a completely redone kitchen in the latest colors, with new Corian countertops, new stainless appliances, and new fixtures and faucets. |
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Up-to-date information about Wichita real estate.
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