The decision to reduce (or a rather positive spin – “improve”) your listing price isn’t always an easy one to make. If an apartment sits too long without any activity, it can become supremely stale. If the price is dropped too early, a seller might miss out on that particular buyer who is willing to get the negotiation ball rolling.
Here are three factors sellers should consider when contemplating dropping their asking price:
How many buyers have seen the property?
If 35-40 buyers have passed through your home and not a single one has placed an offer, it’s time to seriously consider a price improvement. The prime time for offers, when priced correctly, falls within the first few weeks of listing a property. Keep yourself ahead of the game by asking buyers and their brokers for feedback after these initial appointments. Pay close attention to their responses and see if there are any common positives or negatives in their assessments.
How are similar properties faring in the market?
If you’re hesitant in dropping price, evaluate your competition. Are there any homes that have recently gone to contract? Are there recent units that have closed since you listed yours, and if so, what were the closing prices? Are there any new properties that have come on the market? If so, how are they priced? It always helps to analyze the market once again if your property is becoming stale. You may have priced too high out of the gate and now need to make a reasonable adjustment based on current, comparable properties.
What is the average time on the market in your neighborhood?
Make sure you are in the know with regards to how long properties are on the market before they go to contract. In fact, take a closer look at similar properties that may currently be in contract. How many weeks or months were they on before a deal was struck? Did any of them experience a price reduction? If you are well beyond the 'average days on market' timing, chances are it's time to drop price.
Sellers who opt to push the market may be left with a home sitting for months. Understand that the market will ultimately dictate the value of your home. Be extremely thorough -- and reasonable --- with your initial market analysis as overpricing your listing can certainly prove to be a timely and costly risk.
Contact us to discuss listing your property --- or if you have questions about when to drop price!
Brad Malow
Founder, BuyingNYC.com
Licensed Real Estate Salesperson
Douglas Elliman
774 Broadway NY, NY 10003
[email protected]