Relocate to Wisconsin : The Purpose of a Price Reduction/Adjustment is To.....

The Purpose of a Price Reduction/Adjustment is To.....

   As your eyes wander through the listings on MLS and you spot the NEW PRICE  label that accompanies some of them....and click on the "history" button to see what the 
New Improved...now motivated price is over what the past price was for the listing.....you sometimes learn that the Seller Price reducedis driving...or more appropriately, dragging the price...the reduction was $5,000 or less than the previous price that the market rejected.

    Regardless of the price the Seller(s) want...need....must have....the market decides.   The comparables aren't what a they want them to be...what an appraiser may have said months ago...the market decides TODAY what the price is....

      The longer that a house stays on the market at a price that has been rejected...no showings...few showings...no offer....the lower the price will be when the property new pricesells...No Seller wants to hear that...but that is the reality of the real estate market...and the market and the Seller don't always agree.   Sellers are convinced it's just that the "right" Buyer hasn't seen the property...likely that may not happen at that price point.

    Trust an experienced and successful Real Estate agent to guide the pricing structure....agents work on commBinocularsission...and agents who have a reputation that price houses to sell....and reduce them to a NEW LEVEL when they don't ....are the agents that are successful.

        The purpose of a price reduction is to atract a different group of buyers....you won't find them in the same $1-$5,000 price reduction...those are the same people.

     Be an honest agent....explain that the market changes...that there are no crystal balls that determine the price to the penny that the market is willing to pay at any bewaregiven time.....and Sellers...BEWARE of any agent who makes claims to the contrary...it just isn't true.  If a lower price is suggested...it is not because the Agent has any incentive to make less money.

     If you or anyone you know is lookng for real estate agents in southeastern Wisconsin that will tell you the truth...monitor the market and not allow that listing to get stale...but to enjoy that Sellabration in a timely manner...Call the Hansons, we are honored to be at your service for all things real estate.

Sally K. & David L. Hanson, ABR, CDPE, CSS, e-Pro,ILHM, REDS


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Comment balloon 25 commentsSally K. & David L. Hanson • October 01 2017 03:17PM

Comments

I hope home sellers will read this post and learn from it. I   have seen listings where they have reduced the price by $100. I am not sure why they did it.

Posted by Gita Bantwal, REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel (RE/MAX Centre Realtors) 9 months ago

Good morning Sally K. & David L. Hanson .

I currently have a home listed where the price is right online with the market.  Trouble is the driveway is steep.  I think the sellers will pull the listing and just rent the home.  Good call on their part.

Posted by James Dray, Exceptional Agents, Outstanding Results (Fathom Realty AR LLC) 9 months ago

Good morning Sally K. & David L. Hanson ,

You are so right..when I see these small price reductions of $500 or $1,000 I wonder what do they think they are going to accomplish?? The goal of a price reduction is to attract new buyers..$1,000 isn't going to draw flies!

Posted by Dorie Dillard, Serving Buyers & Sellers in NW Austin Real Estate (Coldwell Banker United Realtors® ~ 512.346.1799) 9 months ago

I try to explain that to sellers also - you have to go big or stay home - get to a new bracket of buyers

Posted by Lise Howe, Assoc. Broker and Attorney Licensed in DC, MD, VA, (Keller Williams Capital Properties) 9 months ago

Good morning Sally and David.  If the property is being marketed correctly and it is not selling then the price reduction is the proper action.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) 9 months ago

The price reduction has to be significant enough to present the home to a new group of buyers. Too small of a reduction and it won't change a thing.

Posted by Nathan Gesner, Broker / Property Manager (American West Realty & Management) 9 months ago

Good morning Sally and David. Sometimes changing conditions, beyond your control, require a pricing adjustment. Knowing when to do so is withiin your control. Enjoy your day!  

Posted by Wayne Martin, Real Estate Broker (Wayne M Martin) 9 months ago

Thank you very much for sharing some of your successful business practices.

Posted by Roy Kelley, Roy and Dolores Kelley Photographs (Realty Group Referrals) 9 months ago

I checked to make sure I am following the members who have commented on this blog.

Posted by Roy Kelley, Roy and Dolores Kelley Photographs (Realty Group Referrals) 9 months ago

Good morning, Sally K. & David L. Hanson a new improved price must be just that.... improved.... staying within the same price range does not register as an improvement... make it meaningful and it will work....

Posted by Barbara Todaro, "Franklin MA Homes" (RE/MAX Executive Realty ) 9 months ago

Everything is only worth what someone is willing to pay.

Good to see you can post pictures!  I have not been able to post a photo or picture for over 2 weeks.  And AR hasn't answered my questions as to why...

Posted by Jay Markanich, Home Inspector - servicing all Northern Virginia (Jay Markanich Real Estate Inspections, LLC) 9 months ago

Hi Sally and David -- I'm sure we've all seen some crazy price reductions and scratched our heads in disbelief.     When there is a change make it significant enough to be noticed.  

Posted by Michael Jacobs, Los Angeles Pasadena Area Real Estate 818.516.4393 (Coldwell Banker Residential Brokerage) 9 months ago

Sally and David the first couple of weeks a house is no the market is so very import.  Yet many Sellers insist on the house being listed for higher than their Realtor is telling them it will sell for.  In the end it is a loss of time and money.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) 9 months ago

It cracks me up to see a listing that reduces in price by $1 each week, haha.  Just price it right and get it sold!

Posted by Brian England, MBA, GRI, REALTOR® Real Estate in East Valley AZ (Arizona Focus Realty) 9 months ago

Just now a seller called to decrease the price after a month of telling them, it was a $500 reduction they wanted,  and i want to laugh and cry Sally K. & David L. Hanson 

Posted by Scott Godzyk, One of Manchester NH's Leading Agents (Godzyk Real Estate Services) 9 months ago

I want a seller to read this post Sally K. & David L. Hanson 

Posted by Paul S. Henderson, REALTOR®,CRS,, Tacoma Washington Agent/Broker & Market Authority! (RE/MAX Professionals.) 9 months ago

Oh my gosh, we see these all the time - in $100 increments, once a week, Hansons both!

Drives me nuts and the reason they do it is to move the property to the top of the searches - a price change does that. Most buyers just laugh right past that house...again!

Posted by Debe Maxwell, CRS, Charlotte Homes for Sale - Charlotte Neighborhoods (www.AtHomesCharlotte.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310) 9 months ago

Today's Buyers are way more aware and educated than to fall for the re-triggering efforts of a small $100 (or similar) price change, Sally K. & David L. Hanson ... as so many have pointed out, the change must bring new sets of eyes to the home.  That's only done with meaningful, intelligent price drops.

I'm hoping Sellers read this and take your words to heart ...

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) 9 months ago

Good morning Sally and David - getting through the emotions of the sellers is sometimes difficult.

Posted by Grant Schneider, Your Coach Helping You Create Successful Outcomes (Performance Development Strategies) 9 months ago

Well said!! When I announce a price reduction I use the term: Price Improvement. A $500 reduction is not an improvement. 

Thanks for sharing, I hope many Sellers will read and understand.

Posted by John Wiley, Lee County, FL Real Estate GRI, SRES,GREEN,PSA (Right Move Real Estate Group- EXP Realty) 9 months ago

Small reductions just reiterate that the house is STILL overpriced because it is STILL on the market...and you are reminding the buyers of that fact.

Posted by Athina Boukas, Certified Residential Specialist (CRS) (Virginia Capital Realty) 9 months ago

You are so right!  A change of price of a few dollars does not change the potential buyers.  If they were going to offer on a house, a few hundred dollars wouldn't encourage or deter them.  The reduction needs to be significant.

Posted by Shirley Coomer, Realtor, Keller Williams Realty, Phoenix Az (Keller Williams Realty Sonoran Living) 9 months ago

Such a true statement that the market decides.  And we all know how the market can change on a dime.  Great post.

Posted by Paula McDonald, Magnolia Realty ~ Granbury, TX 936-203-0279 (Magnolia Realty ~ Granbury) 9 months ago

I saw a property in Sacramento the other day with at least 4 price reductions. The agent didn't even care enough to take the home off the market and put it back as a new listing. She just keep reducing the price. It's called "chasing the market down," and that home will eventually sell for far less than it would have if the price had been right in the first place.

I think agents who let their sellers chase the market down are just being vindictive.

Posted by Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, Put 40 years of experience to work for you (Lyon Real Estate) 9 months ago

Spot on advice.  I really like your opinion on $1 -$5,000 price reductions.  Same buyers, same dance, too!

Posted by Jan Green, HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN (Value Added Service, 602-620-2699) 8 months ago

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