Was it the Price?
If you have been selling real estate for awhile, inevitably you are going to have a listing that doesn't sell. As a Realtor, this is very disappointing because of the time, energy and money we (well, some of us) put into getting a property sold - expensive glossy brochures, professional photography, open houses, broker tours, website promotions, e-blasts, cocktail parties, just listed cards, yard signs, Facebook and other social media ads, Google ads, weekly property photos on Instagram, pitching to colleagues, updates to sellers, showings, questions from showings, hundreds of texts, emails and phone calls with client, etcetera. We do all of this before making the first dollar (that's why we charge 6-7%).
So, why didn't the property sell?
- Was it the brochures? Handy to have and to share, but a buyer doesn't fall in love with a home and not buy it because there were no brochures or they weren't nice enough.
- Was it lack of open houses? Probably not. Statistically, less than 2% of homes are sold via open house.
- Was it lack of awareness by the Realtor community? If it was on MLS then this is probably not the case. MLS is an invitation to every Realtor in the area to bring their buyer.
- Was it bad photos? That is a real possibility.
- Was it due to lack of a push on Facebook. Unlikely.
- Was it because the property was hard to access? Very possible.
- Was it because there was no buyer/broker cocktail party? Highly unlikely.
- Was it because the property showed poorly, was messy or in disrepair? Totally possible.
- Was it due to lack of enthusiasm by your listing agent? Perhaps.
- Was there a fixable problem that needed to be rectified. Possibly.
- Was it because the asking price was too high? This is usually the case.
It’s better to be the First Child, the Second Spouse, and the Third Realtor
Unfortunately, sellers don't want to hear that their asking price is too high. They look for other reasons first. I get it. I have sold several personal properties and always wanted to set a new high price in the neighborhood. As Realtors, price can be an uncomfortable conversation to have with a seller. We want your property to sell for a high price. You end up happy. That makes us happy. We end up making more money, which also makes us happy.
It is interesting to me when a property sells with the second or third Realtor and the seller attributes the sale to something other than the new lower price. Some sellers believe it was the prettier brochures, fancier virtual tour, bigger brokerage, aerial photography, Facebook posts, just listed cards or something else other than price. I am not sure why this is the case. Perhaps, sellers just didn't want to acknowledge with the first Realtor that their property was worth less than they thought.
Was it the Asking Price or Something Else?
Below are 20 recent sales in the Sarasota area where the property was listed with one brokerage, failed to sell and subsequently was listed and sold with a 2nd brokerage.
Was it necessary to lower the asking price to get the property sold with the 2nd broker?
- 20/21 or 95% had a price reduction
- 15/21 or 70% had a price reduction greater than 5%
- Average price reduction of the 20 sales was 16%
- Largest price reduction - 30%
- Smallest price reduction - 1%
|Address||Original Price||Price at Expiration||Price at Sale||Sales Price||% Price Change to Sell|
|1521 OAK ST, #16||$1,150,000||$1,150,000||$995,000||$950,000||13%|
|1111 N GULFSTREAM AVE, #13B||$659,000||$659,000||$625,000||$625,000||5%|
|5084 WINDWARD AVE||$1,389,000||$1,295,000||$1,095,000||$1,075,000||16%|
|100 OGDEN ST||$4,250,000||$3,950,000||$2,750,000||$2,500,000||30%|
|1947 MORRILL ST||$1,000,000||$1,000,000||$799,000||$680,000||20%|
|430 GIVENS ST||$1,695,000||$1,599,000||$1,395,000||$1,245,000||23%|
|1102 BENJAMIN FRANKLIN DR||$629,000||$564,900||$525,000||$499,500||7%|
|565 SANCTUARY DR, #B206||$1,049,000||$995,000||$949,000||$755,000||5%|
|1655 QUAIL DR||$1,250,000||$1,149,000||$1,000,000||$935,000||13%|
|1800 BENJAMIN FRANKLIN DR, #B307||$1,030,000||$995,000||$950,000||$910,000||6%|
|2489 HYDE PARK ST||$699,900||$540,000||$499,900||$499,900||7%|
|1625 S LODGE DR||$2,099,000||$1,795,000||$1,695,000||$1,600,000||6%|
|2500 WILKINSON RD||$875,000||$825,000||$825,000||$722,650||0%|
|5855 MIDNIGHT PASS RD, #219||$475,000||$437,500||$419,000||$400,000||4%|
|505 S ORANGE AVE, #1502||$1,750,000||$1,750,000||$1,695,000||$1,500,000||3%|
|6308 MIDNIGHT PASS RD, #17||$578,000||$578,000||$570,000||$525,000||1%|
|1212 BENJAMIN FRANKLIN DR, #909||$799,000||$799,000||$719,000||$670,000||10%|
|2582 BAY ST||$539,900||$524,990||$519,990||$519,990||1%|
|577 S SPOONBILL DR||$1,399,000||$1,249,000||$1,199,000||$1,050,000||4%|
|1912 HIGH POINT DR||$1,199,000||$899,900||$797,000||$700,000||11%|
|2423 VACCARO DR||$685,000||$685,000||$629,000||$612,500||8%|
I'm confident that if I examined more sales with 2+ listing brokerages that the results would be similar. Even if the number of properties sold without a price reduction were to double or triple they would still only be at 10%-15%.
I am a firm believer that a price reduction is the most common reason a property sells with a later Realtor (2+). With that being said, I have seen properties not sell for other reasons. If your property isn't selling, you should consult with your Realtor, review your asking price as well other potential problems.
The quantitative conclusion is valid and helpful but does not address the 'qualitative' aspect of the sale. I too have sold several personal properties and am in the process right now in NJ (so I can re-invest in the Sarasota area). I have witnessed the 2nd Realtors either 'better able' or 'more willing' to tell the story, For one condo property I posed as a neighbor and a maintenance person when Realtors during the initial listing showed the property just to get a candid sampling of how they presented the property to prospective buyers......very disappointing. Not one person talked up the value of the waterfront property. Not one mentioned anything about radiant heating, central air, upgraded materials, low condo fees, etc. The original folks with whom I listed the property were competent, knew how to talk up the attributes, pre-qualify they buyers, and be respectful in making appointments with tenants. However, many 'other' real estate persons with access to MLS simply had the attitude that they could visit any day, any time, with little to no notice - not good.
So in the end, you're probably right - it's the price. Sometimes the sellers dream is just a little too high for the market, but in a number of other occasions the price may need to be adjusted down to the level of knowledge and enthusiasm of the 'professional' agents engaging the buyers.
Should there be a 'Premium Level MLS' accessible only by Realtors with a brain, enthusiasm, and savvy? Perhaps.
The take away from all this information?
Choose your price AND your Realtor very carefully.
When these props sell will be looking for waterfront or marina community in your area.
Receiving continuing listing info from Suzanne Crandall - patient and helpful person.
Appreciate the opportunity to comment.
Bob, thank you for the fantastic comment. I love the idea of a Premium Level MLS. I doubt someone could pull that off but it is an interesting idea. Let us know how we can help. ;-)
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