A good understanding of what it takes to sell a property starts with the definition of “fair market value”. That is the price a willing buyer and a willing seller agree to after a property is given reasonable exposure to the market.
There are two key elements in that definition. One is that it takes two to make a deal. It takes agreement between two parties with different interests. Real estate agents, appraisers or market studies do not set sale prices. Buyers and sellers set them. Buyers are free to offer whatever they want, as are sellers free to ask any price they choose, but the fair market value is the value at which deals will be made… where the two sides can meet.
The other key element is the need to provide adequate exposure to the market. Exposure assumes a reasonable time period as well as methods to assure that buyers who are looking for that type property will have an opportunity to know of the property being offered. Recently sellers have been spoiled because demand has far exceeded the supply of most types of homes. Often it only took a few days of exposure to the market to receive one or more offers to buy. In a more normal market, in may take several months, or more.
Myths about Selling Property
Some agents, when soliciting a property listing, will emphasize the number of agents in their office, or the amount of print advertising they do to promote a seller’s home. The suggestion is these are critical factors in affecting a sale. The truth is somewhat different. >p>The single most powerful tool in creating exposure is listing a home with a member of the MLS, who will post information about the property in the MLS database. With that one act, every member agent becomes part of the sales force to bring a buyer to the table. In addition, numerous public websites will also pick up that information and make it available to consumers surfing the net. We already know that the vast majority of buyers today are searching the internet for homes, at least as an initial step into the market.
What agents know is that advertising and open houses do more to promote the agent’s own business with potential buyer clients than they ever do to sell the property advertised.
When a Property Does Not Sell
If a property for sale does not sell after a reasonable period, there are only three possible explanations. Either the price is too high to attract buyers, or the property has not been given adequate exposure so that potential buyers can learn of it, or there are obstacles in the way of making a deal, like a property that is difficult to show due to some problem with access. Owner’s of properties that are not selling need to be objective in assessing the real reasons. If the property has been exposed to the market through the MLS for a period of three to six months, and there are no unusual obstacles, the price is almost assuredly too high.