I often hear from home sellers that they don’t want to take the first offer because a better offer will come along. In my experience, just the opposite is true. The first offer for your home is typically the best offer, and you can usually counter the buyer’s offer to get it at or close to full price.
Most serious home buyers are searching for the perfect home on the internet, and they receive instant email updates, of new listings matching their search criteria as they come on the market. This generates the most interest and showings during the first 10 days a property is on the market.
The newer the listing, the closer to asking price the seller receives. Many buyers have lost out in multiple offers on other properties, so they hurry to get their offer in before anyone else, to avoid multiple offers. Because of their fear of loss, their first offer is usually a good one.
Waiting for a better offer can cost sellers money. When we price your home, we look at the current competition, in addition to the sales, and if your neighbor does a price reduction or sells for less, your home value will drop in the eyes of the buyers and the appraisers. You can also miss the peak of market and fall into a slower season, or interest rates could rise, making your home less affordable to buyers.
When a home has been on the market for a long time without selling, the buyers think there is something wrong with it and even if they do like it and make an offer, they tend to make an offer at a greater discount.
In Chisago County, in 2016, the average home sold for 98% of the list price. Most homes were priced well, the new construction homes sold at full price or above because of upgrades, and there was a shortage of inventory. Half of the sellers paid up to 3% towards the buyer’s closing costs in addition to the average 2% discount. Paying the buyer’s closing costs is equal to a price reduction, and necessary, as most buyers don’t have enough cash for the required down payment and the closing costs. The highest priced homes sold for the greatest price reduction, with the highest reduction at 20% of the list price.
An experienced real estate agent can help you negotiate the best price for your home.
Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to firstname.lastname@example.org. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.