Take a look at this Excellent analogy from Liz and Bill Spear about the 2 races in every Real Estate Market. It clearly defines the risks involved in not pricing your home properly right from the start when selling your home and not making that fair market value offer as your first offer when buying a home.
The Analogy given is a great way to look at it. I can picture those races clearly in my mind. I guess that's because I'm a Realtor. (that's supposed to be funny but I guess it did not come out that way.)
There Are Two Races In Every Real Estate Market
There are two races being run simultaneously in every real estate market around the nation. Doesn't matter if it's buyer's market or seller's market, the same two races are still being run. There are winners, there are losers, and you and your agent's recognition that you are indeed in a race may make all the difference!
The sellers and their listing agents are all racing each other. Best combination of price, location, condition, in demand features and marketing crosses the finish line first.
And for the most part, the sellers can see the entire race. Their competition is plainly visible. An MLS search combined with knowledge of the local market and the other racers are identified. The Jones two streets over are for sale for $10k less, but they don't have a finished basement. The Aziz family five houses down has a finished basement, they're throwing in the media center AND they're priced $5k less than us?? Uh oh. And what do you mean the new construction a mile down the road is sweetening the pot with 1/2 off options?
But at least the competitors are right there out in the open. Set your strategy, decide whether it's okay for others to finish selling their home before you do, and act accordingly.
The 2nd race belongs to the home buyers. Their challenge is their competition is almost invisible. Sure they know other folks are looking, they might even run into some of them during showings. But the buyers are unlikely to know exactly how many buyers are out there looking for the same thing as them, and if someone else is about to make an offer on that home they want.
And you know what? Murphy's Law is FULLY into play here. But BLiz, that home has been on the market for 493 days and not sold, SURELY no one else will put in an offer at the same time as we do, right??? You'd like to think so wouldn't you? But care to guess how often we've seen a home on the market an extended period of time suddenly get more than one offer? Like we said, Murphy's Law of Home Buying.
And if the buyers spend a lot of time offering, then countering, then countering the counter.....well all that time involved leaves the door open wide open for Buyer B to walk in, drop a better offer into play and have the Seller sign and accept. Buyer A may never even realize one of their invisible competitors just crossed the finish line ahead of them. And don't assume the seller will ask for your highest and best or give you any warning. They don't have to, they don't always do so, and remember the listing agents work for the sellers, NOT the buyers and buyer's agents.
So Sellers, the race course is laid out in front of you and your competitors are clearly visible. Decide what place you want to finish and execute the strategy with your listing agent that gets the job done.
And Buyers, even though you can't see your competitors, they're out there. When you find a house you love, don't mess around with the negotiations. Get serious from the start, get it done, and get it in writing and accepted, so YOU can own the home. Getting close isn't good enough. And don't let your agent tell you tomorrow is good enough to get those signatures, because tonight someone may be submitting a better offer.
The listing agent works for the seller, it's business, and it's their job to get the best possible terms for their seller. They won't shed any tears at all if you're disappointed that you didn't get the home.
So are you ready to win a race, or do you want to be an also ran?
Liz and Bill aka BLiz
P.S. If you're thinking about entering the Warren County real estate race, please give The Liz Spear Team of RE/MAX Elite a call. Whether you're planning to buy or sell an area home, we've got the expertise to help you cross that finish line!
The Liz Spear Team
Elizabeth & William Spear
RE/MAX Elite: Ask for us by name if you visit the office!
Two locations: Lebanon & Mason, OH
Liz direct: 513-265-3004
Bill direct: 513-520-5305 Fax: 866-302-8418
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When looking for a Realtor in the Poconos that will listen, assist and guide you without "pushing" you, contact Bobbie Smith. I would love to help.
Bobbie Smith, CRS
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All pictures, text, etc. stated within is the exclusive property of Bobbie Smith and cannot be copied or duplicated without written consent from Bobbie Smith. All statistics and data contained herein are obtained from reliable sources and are deemed reliable however each individual should always do their own research on each topic and derive their own conclusions. Any statements of opinion are just that, the opinions of Bobbie Smith.