Tag Archives: Sellers and pricing

The mind of the seller

So I’m out on open house tours today and come across a decent house, with pool, good design and very nice grounds, way up off Stanwich Road. It’s priced just a tad over  $4 million and I was thinking of showing it to a couple of clients because at, say, $3.5 million, it would be a good purchase. But then I noticed that the price had just been raised (!). “This morning,” confirmed the listing agent. “The owner got tired of getting bids in the mid-threes so he raised the price to show that he’s a serious seller.”

The guy may be a man of serious purpose, but that purpose is clearly not to sell his house. One, even two “low” bids might be written off as the work of those dreaded low-ballers. Three or more, all in the same range, is as loud a message you’re going to get that you’ve overpriced your house compared to its competition. The response to that message is not to raise your price. Not if you want to sell the place. It astonishes me how successful businessmen, and anyone who can afford a high end Greenwich house is almost always a successful businessman or woman, can make sound, rational decisions about business matters and completely lose their minds when trying to sell their personal home.

Or this guy is just dumb, and is living on his inheritance.

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Seller’s remorse?

Just had a proposed deal founder over a 7% difference between what my buyers’ mortgage lender had approved and what the sellers “needed” for their house. I understand: just as buyers hit a ceiling and can go no higher, sellers can have a floor. But my guess is that these sellers may regret their choice because, while my buyers will just move on and find another house, the sellers will still have a house they no longer want. For how long? maybe just the weekend, maybe longer.

This month 23 single family houses went to contract, qa distinct improvement from last month’s 12,but a far cry from April 2007’s 74. Of the 23, eight have already sold so I have their actual closing prices. Those eight sold from a low of 41% of the original asking price to a high of 90% (37 Andrews farm Road, if you’re interested). Average: 69% of original asking price. And, while I can’t tell the final price for those houses under contract, every single one of them sold for less than ask and many of them were way, way off their original price before they found a buyer.

So our happy home seller will pass up a definite sale now in the hope of achieving 6.8% more down the road. He may get that – the statistics suggest otherwise.

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