How to sell a house in a bad market

I can’t say which one because it’s only at the “accepted offer” phase but I just called the listing agent of a house whose huge price reduction I wrote about last week – I wanted to set up an appointment to show it tomorrow but too late. I’m not at all surprised – I emailed three of my own clients when this reduction came through and said, “bargain, in any market”. I wasn’t the only one to think so, obviously.

So the lesson is that, if you really want to sell your house, there are buyers out there, ready to act. But there has to be a price low enough (or realistic enough, take your pick) to stir them into action.

10 Comments

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10 responses to “How to sell a house in a bad market

  1. Peg

    I’m about to put a new listing on the market (at a price a tad less than the standard Greenwich fare). But, I advised my client that, though it appears to defy common sense, often a lower asking price can net a seller more than a higher asking price.

    Finding the fish who will overpay is close to zero in a market like this. Thus, having a more realistic price benefits in at least three respects. First, people are more likely to come and look at the house (if they don’t come to see it, they ain’t gonna buy it.) Second, your home will compare more favorably to others if it is priced well and the others are not. Third, as Christopher points out, the better pricing can be one of the catalysts to encourage an offer. A higher price leads to: “Oh, it should be around for a long time – let’s keep looking” kind of thinking.

  2. greenmtnpunter

    Interesting comments from Sitehost/ Blogger-In-Chief, Mr Fountain, and others on making a market in Greenwich real estate these days. Their advice sounds like the advice I am giving my Vermont clients, remembering, of course, that the definition of a broker is, in essence, the ability to “make a market”. Just like the specialists on Wall St when the stock bid/ask gap is too wide. Skilled real estate brokers must lead the way and make the market, now more than ever. And it is now more than ever that sellers need a market-wise broker. OK, ok, enough horn tooting for today from up here in the sticks where it’s only 10 below- time to put another log- or 2- on the fire.

  3. xyzzy

    My guess is 317 Standwich Road.

    Could be 11 Quail

  4. Retired IB'er

    Not surprised at all. Just under 3 acres in a nice area and nicely finished 5,700 sq. ft. house at an asking price of of $2.25 million. Heck, it even got my attention and you know what a bear I am on real estate at this point.

    Looking forward to seeing the final price.

    Chris, assuming it sells for $2.1 to 2.2 million, what would you say that says for current pricing levels (ie 2003… 2002…2001 pricing)?

  5. christopherfountain

    XYZZ and Retired IB’r seem to have the right house in mind. And what does that say about pricing? Well, as I just posted, a friend and fellow agent thinks we’re at 1999 levels, which is exactly where this one was. One sale does not make the market, but if I were contemplating selling my house I’d consider 1999 prices and decide whether I could live with that.

    Further thought, this one more cheerful: while there’s no guarantee that the real estate market won’t continue to fall, this sale illustrates that, as of today, a clearing price can be found at 1999 levels. I’m not saying we’re at the bottom, but it’s encouraging that, if you need to sell now, you can do it – this price produced a flood of frustrated buyers and I suspect, if the seller hadn’t been so eager to be done with it, might have generated a price war. A price war in 2009? It’s still possible.

  6. Retired IB'er

    From a University of Chicago presentation:

    Real U.S. housing prices will fall another 15 to 20 percent in the next five years, mostly during the next year or two, said Erik Hurst, V. Duane Rath Professor of Economics and Neubauer Family Faculty Fellow.

    “That is a take-it-to-the-bank prediction,” Hurst promised during the Chicago Booth 2009 Business Forecast at the Hyatt Regency Chicago on December 3. “Historical national, state, and city housing data predict housing booms, with average price increases of 55 percent, are followed 100 percent of the time by housing busts, with an average price decline of 30 percent. Supply always adjusts in the long run. As you expand supply, prices are pushed down,” he said.

    Continued housing devaluation could cause more mortgage defaults, further pressuring bank balance sheets and further slowing the economy in 2009, and uncertainty about lending will potentially lengthen the current recession, Hurst said. “It might take a year and a half to get this uncertainty, which is passed through to consumers, resolved from the economy,” he said

  7. Limestoner

    Chris,

    Do you have the skinny on this prop?

    http://www.liveingreenwich.com/listings/l0137.html

    It’s listed by Shore & Country at $5.95mm and has been on the market since Aug ’08. I believe this is in Riverside. Is this too rich? What are the drawbacks? How’s the location? Do you know the address?

    Thanks.

    • christopherfountain

      It’s on Clapboard Ridge – I think it may be priced close to what they paid for it but these days, so what? I’ll go onto the MLS in a moment and return with its history. As I recall, decent property, certainly a good location but perhaps a quirky layout? Nothing off-putting, just a tad unusual and I don’t remember why I thought that.

  8. CEA

    That’s on Grahampton, near Beechcroft. Big house, backhard is narrow and overlooks the people behind. 0 outdoor privacy.

  9. Limestoner

    Thanks Chris! You’re the best!