The Market Has Shifted and Sellers Who Have Not Are Paying for It

Buyers have more inventory to choose from right now than they did two years ago. They have more negotiating power. They have less urgency. The conditions that made aggressive pricing and quick multiple-offer closings the norm have been replaced by a market where buyers are taking their time and walking away from listings that do not present genuine value at the asking price.

Danh Bui works on the financing side of transactions and sees the downstream consequences of seller pricing mistakes regularly. The conversation worth having is before the listing goes live not after sixty days of market time have accumulated.

Why Overpriced Listings Produce Worse Outcomes Than Sellers Expect

Most sellers keep returning to the wrong reference point. What the neighbor received two years ago. What an online estimate showed last spring. Neither reflects the market those sellers are actually selling into today and pricing based on either almost always produces the same outcome.

When a listing comes to market priced above where active buyers are willing to engage those buyers simply move on. The first two weeks of a listing generate the most attention from motivated buyers who are watching the market closely and move quickly when the right property appears at the right price. Price above the market and those buyers pass without a second look.

Days on market accumulate. Once a listing has been sitting the assumption that develops in every buyer’s mind is that something must be wrong with the property itself rather than the price. That perception is hard to overcome regardless of how good the home actually is.

The seller who overpriced eventually cuts the price anyway but from a weakened negotiating position after market time has done its damage. The final net result is frequently worse than correct day-one pricing would have produced.

What Actually Works in the Current Market

Price it right from day one. Correct pricing generates activity and activity generates offers. In a market where buyers are comparing options carefully a property priced to reflect actual current conditions stands out immediately from inventory that has been sitting. That early momentum is what produces the best seller outcomes.

Think beyond the price cut when flexibility is needed. A seller credit directed toward the buyer’s closing costs or a rate buydown often does more for the buyer’s monthly payment than a price reduction of the same dollar amount and it keeps the recorded sale price higher in the process. Those two approaches do not produce identical outcomes and understanding the difference before making the decision produces better results for sellers.

Danh Bui can show exactly what a seller-funded rate buydown does to a buyer’s payment compared to an equivalent price drop side by side. That comparison changes how the concession conversation happens and it is worth having before the next price reduction is made.

Know your local market rather than reacting to national headlines. What is happening in your specific neighborhood’s inventory and days on market is what determines how your listing should be priced and positioned. National housing data describes average conditions across millions of transactions in dramatically different markets and does not tell you what a buyer competing for your specific property today is actually willing to pay.

The Conversation That Saves Deals

If you are selling or you are an agent with a listing that has been sitting message Danh Bui. He will run the numbers on what a buydown does to a buyer’s payment compared to a price drop so the decision is based on actual figures rather than assumptions about which approach produces the better outcome.

Sources

NAR.realtor
MortgageNewsDaily.com
ConsumerFinancialProtectionBureau.gov
FannieMae.com
Investopedia.com