June 2021

Most of May's sales activity can be summed up as unbelievable, however, the last week of May saw a handful of homes that didn't get a single offer which was shocking. Was it just an off week before Memorial Day weekend or has buyer fatigue setting in? Only time will tell. The average single family house sold for over $1,400,000 and for 20% over the asking price. It's important to keep in mind that many agents use the list price as a marketing tool. For example, let's say you think your house should sell for $1.4M. It is very common for agents to suggest listing the house for $1.1M and you say, "But that's absurd, I will not sell my house for $1.1M." The agent will try to assure you that by using the low price listing strategy you will get more online views, more buyers through the property and more offers to create a bidding war that could potentially get you the $1.4M or more than you want.

Many owners might say, "I disagree with this pricing strategy. It's fake advertising and I want $1.4M for my house so I want a list price of $1,399,000." What happens in this case since buyers are programmed to look at a list price and say, "Well if that's the list price and it's going to sell for hundreds of thousands of dollars or more then I don't even want to go look at it because it's already out of my price range." The end result is typically fewer online views, fewer buyers through the house and fewer, if any offers.

Sometimes a homeowner might say, "Maybe I'll just sell off market or privately to someone I know. I don't need to go on the market in a hot market like this when I can save the 5% or 6% commission and sell it myself." A few people have done that but at great cost. Yes, the 5% commission (2.5% per side) is $70,000 on a $1.4M sale. The problem with a private or off market sale is that owners usually get even more money by going on market to allow the price to get bid up. What's more important? Saving $70,000 in commission or making $200,000 more on the sale?