Residential real estate is selling at a fast clip these days. According to figures from the National Association of Realtors and the National Association of Home Builders, approximately 6.8 million newly constructed and existing homes will sell this year.
But that’s small comfort to those whose homes not only haven’t sold, but who haven’t even received a single offer.
If your home has been on the market for three months without an offer, agents say there is something wrong with the condition of your home, or the price at which you’ve listed it. You might also have a marketing problem.
That’s tough for some sellers to hear, particularly those sellers who have already closed on their new home and are carrying an old mortgage, new mortgage and perhaps even a bridge loan.
What can you do if your home hasn’t sold? Consider taking these steps:
- Rethink your pricing. Everything sells at the right price, is what many brokers and agents say to their clients. While that’s true, you don’t want to gut your list price and give your property away. But if your home has languished on the market for months and months, it may be time to give yourself a reality check.
Ask your agent to pull up new “comps,” the sales price of homes similar to yours that have recently sold in your neighborhood. Spend some time thinking about why these homes have sold, how the amenities each home has are different (better or worse) than your home, and which amenities may have helped increase the sales price or, at a minimum, helped close the deal.
If a number of homes identical to yours have sold at about the price point you’re at, then you may have a condition, landscaping, or decorating problem. That is, the other homes may have been in better condition or had better landscaping for the price or the decorating may have been more neutral. Look over the data with your agent to help pinpoint reasons why your home hasn’t sold.
- Upgrade the condition or landscaping of your home. If you and your agent come to the conclusion that the other homes in your neighborhood were in better condition, or had better landscaping, then you either need to adjust your price downward, or you need to take care of the issue as inexpensively (not cheaply!) as possible.
That might mean hiring a professional landscape company to give your home a mid-summer upgrade, planting colorful flowers in pots or buying colorful hanging plants to liven up your entrance. Your grass, bushes, hedges and edging might need work to give your home’s exterior a little sparkle.
If your home’s exterior needs to be repainted, you will either have to do the work or discount your home’s price. I suggest you have the work done, because buyers typically don’t want to move into a home and have to schedule major work.
If your home’s interior needs an upgrade, start with the inexpensive stuff: white (or off-white) paint, with glossy white on the trimwork and cleaning the carpets. If you need to do a more extensive remodel, consider lowering your price rather than gutting your kitchen. Most studies show that homeowners rarely, if ever, recoup all the cash they spend in a major remodeling project undertaken within a year of sales.
But if you do decide to discount your list price rather than doing the remodeling project, be prepared to lower your price not only enough to cover the cost of the project, but the inconvenience to the buyer as well.
- Upgrade your marketing. Is your agent doing the best job possible? Or, has he or she gotten discouraged by the lack of interest in your property. Agents have feelings, too, and some might feel bad that their marketing strategy hasn’t worked. Perhaps the agent has gone on summer vacation, and hasn’t been doing the marketing work necessary to get the word out about your property. (And no, in my opinion, simply listing the home in the local multiple listing service isn’t enough in some cases.)
Although you might like your agent personally, he or she might no longer be the right person for the job. Talk to your agent about how the property is being marketed. Ask about holding an open house and getting the word out. Ask about using buyer broker or home buyer incentives to increase traffic.
If your agent seems unresponsive, you may need to hire a different agent. If you decide to do that, start from scratch and invite three agents in to do a comparative marketing analysis, consisting of recent comp data, a suggested listing price and marketing strategies.
While you’re doing the legwork, take your home off the market and give it a breather. That will allow you to reintroduce it in a fresher way, once you’ve dealt with any pricing, condition or marketing issues you may have had.
July 25, 2003.