Is Your Home A Product or a Commodity? Why won't it sell?

Market Update

Is your home a product or a commodity? Why won't it sell?

Many people think that during a “buyers” market, there is less of a buyer pool and when it’s a seller’s market, there is a huge buyer’s pool. The truth is, while financing has stopped some people from being able to purchase in this market, there is still a very large pool of people looking to move up, relocate, change school systems and just plain, “buy”. Particularly in this area where excellent schools and the Midtown direct train rules! So why are so many homes just sitting?

Most people believe a home is a product. You attach a price to it, you list it and you want your price for it…..and you barely budge because YOU think it’s worth that. After all, you paid that 3 years ago when YOU bought it. Or your neighbor sold 3 years ago and they got that much.

 Actually, a home is a commodity. Just like stocks, gold and bonds, it fluctuates with the market. It goes up and it goes down. A product is more like a burger that you buy from McDonalds. They put a price on it, you buy it or you don’t. It remains constant, for the most part. Most seller’s are having a difficult time understanding this concept. What helps when selling a home is that there is an emotional element involved. People come to see it and if they love it, they will buy it. They will even drive the price up if they love it enough and if they perceive value. This is what makes it different from most other commodities, but it is still a commodity, not a product. It goes up and down.

Now, even the best of towns are feeling the pinch of lower prices, some places much more than others. The trick when pricing a home in this market is to price it so the buyer see’s VALUE. Your agent should be honest with you and tell you what has sold in the last 2 months and sometimes that’s too old because we are in a declining market. Every month that your home sits on the market, it looses value. Prices are moving lower each and every month. If you are not pricing your home near where the last one sold, (and it is similar) you could be there a long, long time. No one wants to pay more for a home than the last one sold for in a declining market. Would you? Six months could cost you a fortune, depending on the price and size of your home. You really have about two weeks to capture a buyer and then the buyer pool declines rapidly. Of course the larger and more expensive the home, the longer it takes depending on condition and location. Homes that are completely updated, nicely painted, staged with good landscaping and in a good location will be the first to sell. No one wants to do renovations today but most buyer's will positively pay more for a home in pristine condition.

You need a great agent that can help you prepare your home to sell, stage it if necessary and price it so buyer’s will see tremendous “value” and your home will sell, even in this market. Anything less, and your home will become one of the statistics. It's proven over and over, market age kills! Pricing your home correctly is everything in this market.