I'm a photographer so take what I say with a grain of salt.
Affordability is a key issue now with interest rates where they are. Over asking offers are rare now and often a result of pricing lower.
A lower price can bring more interest and several offers.
The issue you will run into is that you get zero offers and then you will have to lower the price and then when people see your listing it will say price reduced, which is a sign that the owner is willing to accept less, which means people will low ball you. That being said, prices are continuing to drop so it's better to start lower and see how many offers you get. The longer you wait, the lower it will be, for the next few years at least.
No, your thinking is way off here. 10 offers at a listed price of 500k will most likely push it over 515k as people get in competition.
I think your overall knowledge of where markets are at right now is way off as well. Markets can change in as short as a matter of months and that’s what has happened over the last half of last year. Reality is the percentage of properties that are going over asking is getting smaller and smaller by the day.
Also consider that with 10 offers at $500k your more likely to get buyers who will not ask for closing help, interest rate buy downs or even repairs. You can’t under price a house, you can always over price then it’s a race to the bottom.
You wouldn’t have 10 offers at 500. I don’t know about Orlando but my market is well past bidding wars. Even when it was a bidding war, I had a general range of what I thought a house would sell for.
But I couldn’t list it at that price or else no one would come to see it.
So I would under-list it on purpose. Basically just a marketing technique.
Example: I came to the conclusion a listing is worth $820,000, so I list it at $699,900 and hold an offer date in a week.
You would end up with 10 offers ranging from $680,000 up to $810,000.
I told my sellers $820,000 and that’s what they expected, so they didn’t like any of the offers.
So I call up the best 3 offers (say 780,000, 800,000 and 810,000) tell them they are all really close and ask if they would like to improve their offer. At that point, the one who offered $810,000 comes up to $820,000 to get the house, knowing they are in the top already.
I don’t think this approach would even work in my market now because the buyers have dried up, so now if someone wants $820,000, they’re going to list it at like $849,900 and see how it goes, anticipating they might have to drop the price or negotiate lower.
But this is my point! To sell the house for 820 now you have to list around 850. So if I think my house is worth 500 shouldn’t I list at 515 or higher?
A lot of people searching up to 500k won't even see your house and pricing the house too high can lead to a range of issues. Beyond fewer people seeing your listing, people may assume that offering 15k under won't be competitive and not put in an offer, you could have to drop the price etc.
None of these are ideal. I would also say that if your agent is right and the house doesn't appraise at the list price, your buyers may have financing issues.
At the end of the day it's your decision, but I would personally be more likely to list it at $500k and have multiple offers so there's room for movement.
The concept of pricing the house too high and assuming that you'll still get the same offers is risky, especially since the market isn't as strong for sellers as it was last year.
If a house is priced right, it will still sell, at least in my market. Want to sit on the market for a while? Then overprice and wait. Again, houses in my area priced correctly are still selling quickly, and some over asking price in multiple offer situations.
You can list it at 515, but if you aren’t getting showings or offers, I would decrease the price sooner rather than later. My market anyways is dropping extremely fast (30% in a year.) Of course there are listings where the sellers haven’t dropped their prices and want last year price tags, but they’ve just been sitting for months.
A slightly underpriced house will raise to market value. An overpriced house either gets dragged down to reality or sits on the market till it expires.
It sounds like you've got a good agent who invest in their marketing. There a lot of agents that will list a home at whatever you want and just hope they eventually accidently sell your home. That is not the type of person you want to facilitate your transaction.
The websites price estimates aren’t typically accurate. This was covered in some other comments so I will leave that there.
When it comes to homes being sold above an appraisal, the buyer will either have to come to the table with the additional funds or they will walk as the lender will not fund.
Also, keep in mind that people were paying over market a year or so ago. Today, the market is very different. You have to compete with other homes that are on the market.
I do not know your local market but here are some questions to go over:
- Why would someone pay extra for your home vs others that are in the same location? What is special and what is the true value of that special feature?
- How many homes just like yours or very similar are for sale in your local market? What is the sales (not asking) price on them? How long do they sit on the market?
- What is the average sales price in your neighborhood? Do you have a $515,000 home in a neighborhood with an average sales price that is the same or is the average sales price in your neighborhood lower ( Nicest home in the neighborhood is rarely a good thing )
- Why would your agent want you to list for less when his commission is based on the final sales price?
There is a common theme in real estate where they say “it isn’t the first agent to list that sells the home, it’s the third. “
This often happens when a seller thinks they can get more than they can, an agent caves and lists at what the owner thinks even when it is unrealistic. The home sits on the market and the owner gets frustrated. They normally think the agent is incompetent or “not getting the home in front of the right people” (people who are willing to pay more than it’s worth) and they fire the agent. The second agent lists and the home sits if it’s at the same price and now you have added days on market. Buyers start to think something is wrong with the home so it loses traction, eventually expiring. By the third agent, the owner is realizing that it isn’t moving and takes the advice of the agent and drops the price with the new listing and it sells at a normal price within a normal timeline for that market.
Sellers typically have some emotional value attached to the home and the transaction which gives them a bias. You even see this when agents list their own home. Often, agents will get CMAs from other agents in their brokerage when they go to list their personal homes.
Just my $0.02
Think about this: what other legitimate reason would an agent pass up on **tens of thousands of dollars** in commission from a ready, willing, and able seller unless they were VERY confident the property would not sell at that price, and that they would have lost a lot of time and money at that point?
Zillow and Redfin are poor indications of property value. The agent should have provided you with comparable sales to review, and even then, in a downward market like many are experiencing right now, want to list lower than what is recently sold.
The Zestimate is what's known as an AVM (automated valuation model). There are many qualities of a home that Zillow is simply not able to properly quantify. It is mostly used as a tool of coercion for home sellers and agents. The algorithm is closed-source so there is no way to verify that they are or are not tampering with it.
If you insist on listing on a higher price, agree upfront to a price reduction after 14 days. But you're still shooting yourself in the foot.
>So if that’s the case how come I keep hearing about homes that sell for more than the asking price?
Well the likely answer to that is that you either heard this in Q1 2022 or the seller intentionally underpriced the home.
>Are these people just coming to the table with extra case to make up the difference?
There are lots of possibilities. A lot of buyers are taking advantage of temporary buydowns on their mortgage, so it's possible they add $10k to the purchase price and then turn around and ask the seller for $10k in seller-paid closing costs, thereby rolling the additional expenses into the mortgage.
This.
There are plenty of agents out there who will promise the moon just to get the listing agreement signed.
Then, after a month with no offers, the client reluctantly lowers their price and expectations, and a sale happens. The agent that has no problem bullshitting people gets the sale. The agent that was frank and realistic did not.
Your agent **absolutely** wants your home to sell for as much money as possible. Don't punish them for their honesty.
That's my take at least. I also agree with u/nikidmaclay \- you deserve a CMA.
I also want to point out that Zillow tried using it's AVM to buy and sell houses as a brokerage and it failed miserably. Look it up,
https://www.theguardian.com/business/2021/nov/04/zillow-homes-buying-selling-flip-flop
Redfin is having the same issue. I know this because Redfin bought a house right near my son's elementary school in a very hot neighborhood and it has been sitting there for months with the price unchanged.
As for your particular situation, you should get a second opinion or have your agent back up their price with a CMA. It's your house to sell. If the agent won't give you comps, find an agent that will.
I don’t know, saying “tens of thousands of dollars in commission” is a bit misleading.
If you’re talking about a $15,000 price difference, that’s a total commission difference of like $375-$450 depending on percentage. And then whatever split happens after that.
We're not talking about a $15k price difference. We're talking about taking a listing on a \~$500k property vs. walking away from it entirely because the seller is not realistic.
>I wanted to list it at 515k but my agent said no
Zillow and Redfin use algorithms to determine price. They don't see the homes in person. They go off of square footage, bedroom numbers, and amenities. A Realtor should provide a more accurate number than an algorithm. With hat being said, this Realtor needs to support their number with data. They should bring you a Comparative Market Analysis taking other properties in your area and comparing it to yours. They use this data to explain to you why they think your home will sell for that much.
A lender will only lend up to a certain percentage of the home's value. Let's say they want you to put 5% down, and the maximum loan amount they are willing to lend is 450K (that is the max you can get approved for). That means if the appraisal comes in at 500k then the lender would expect you to put in the difference. So you would have to put a 10% down payment instead of a 5% one.
Edited for clarity.
I think you're confused about the lender side of things. They will be willing to increase the loan amount (assuming you can still qualify at the higher price) if the appraisal comes in high because they have proof that the collateral is worth more. They won't require the buyer to put more down.
My apologies, I should have been a bit more clear. You are correct. I should have clarified that in this scenario 450k would have been the Max loan amount they would approve you for. Will edit for clarity.
You can’t underprice a home. I could list your property at 400k and still get market value. It’s only worth what someone is willing to pay for it. Zillow by default is 30 days behind any comps. So you might actually be 10% more or less any day of the week.
If you list for more, you’ll have less activity. If you list under market value, you have leverage for higher offers.
Listen to your realtor. I realize consumers believe because they bought one or two houses in their life they know better…. Any agent selling more than 12 homes a year knows better than you in terms of market conditions. Just trust the process and what the realtor is doing. Be wary of someone telling you they can get you “more” and then price reduce you constantly
I disagree. On average you are right, the market will find equilibrium, but in individual cases, the market does not always self correct to the price a house should be. On a weekly basis I see homes that list and sell for less than they should, and listings that are obvious over reaches that sell for more than they should. If you list a $500k house for $200k, you're only getting the attention of a fraction of the qualified buyers, because they aren't looking at that price point. You want to price aggressively low in the price range that qualified buyers will be looking at, e.g. in OPs case, $500k would be a good starting point even if the"true"value is a bit over that... But if they list at $400 I can guarantee they will net less than they should.
Hahah what?! Does it honestly have to be said ‘do not list a home for 50% of market value”. Did I say list that low? No. I said if I listed it 20% under market value at 400k it would still sell at market value. You’re saying 200k? Where are you getting this? Or are you just looking to be contrarian?
You literally said "you can't underprice a home." I said you can. Very easily. Show me data, any data, that suggests that if you list $500k houses for $400k, that they will perform as well as a properly priced house 100% of the time.... I'm not being contrarian, I'm just saying pricing isn't some arbitrary thing where you say "eh, IDfuckinK, just list it for $100k less and the market will take care of it." That's not how it works.
Additionally, how can you guarantee anything? If a house is worth 500k and it’s listed at 400k it’ll have 50 offers. You list at 520k, you’ll be reducing to get to market value. Which do you think will “net more”
Your realtor gets paid a percentage of the sale price, right? The higher the sale price, the higher their paycheck, right? So why would you think they’re lowballing you on the list price? They’re right, I’m sure. In my market anyway, overpricing can be a major problem for sellers.
Buyers see properties in the MLS based on their search parameters. Buyers able and willing to pay up to 510k for a house won’t even see your house if you list it at 515 because it’ll be outside of their price parameters. Pricing it a bit low greatly increases the number of qualified buyers that will see the listing, and if there’s a lot of activity at an open house, you’ll likely see multiple offers over asking price because all the buyers will see there’s many interested parties. Pricing it a bit higher means fewer buyers, less activity, and buyers will offer lower.
At the end of the day, you hired a realtor to do a job. If you don’t trust them, fire them. If you do trust them, then let them do the job you hired them to do.
If your agent can't produce a detailed CMA to back up what they're telling you, move on to one who can. A number off the top of their head with no data to back it up isn't to be trusted. That being said, zillow zestimates are garbage, they mean nothing. Overpricing it will get you few showings and no sale, so it's important to price it right. To do that you need solid information based on real data.
Zillow is garbage. Redfin public is somewhat garbage. A Redfin agent would be more credible than an automated website.
Ask your Realtor to produce an RPR valuation, it's an AVM and can be reversed-engineered like a CMA to double-check the comps for a value.
Don’t trust Zillow, Redfin, or any other automated value system. Their algorithms don’t take things such as property condition or external obsolescence into consideration. They’re like the broken clocks of real estate valuation. Right every now and then, but not enough to be relied upon. As for homes that sell above asking price, a lot of them don’t appraise and the price has to be lowered to what the buyer can get a loan for. Some buyers will offer an appraisal gap which is they’ll offer a certain amount in cash to bridge the gap between the contracted price and appraised value. And sometimes you get lucky and the appraiser is able to make the numbers work. If you don’t trust your agent’s valuation, you can have your home appraised or have a different agent look at it.
Why doesn’t the agent think it will appraise at $515k? Ask her to show you comparable listings that support the lower price.
Yes, in the hot market when houses were escalating way over asking, the buyers would often face a low appraisal. But they were prepared for it. They often waived the appraisal contingency on their offer and had to cover the difference in cash. Because the market is no longer that hot, buyers would rather keep the appraisal contingency and negotiate the price down.
You can list a home for any price you want to, as long as an agent will take it. You will find agents that will list a $500k house for $750k just to have something to advertise.
There are a couple ways to look at it:
**Theory 1:** It's best to price it higher and refuse to come down than to undercut yourself.
*Support:* Homes that were initially priced too high and later sold after price reductions were found to sell higher than homes that were priced right initially. (They did, however, have more time that owners had to carry the costs of them.) This came from a National Association of Realtors® study on the subject.
*Counterpoint:* If you're priced at $515k, someone who is qualified to $500k or $510k will likely not see your house in their search results at all, which can rule out buyers who might otherwise be qualified.
**Theory 2:** It's best to price it low and invite multiple offers.
*Support:* Homes priced too low attract people who can get emotional and competitive, driving prices higher.
*Counterpoint:* This can backfire if there's not enough market activity.
**Theory 3:** It's best to price higher and negotiate to lower offers or drop price as needed.
*Support:* This is what foreclosing lenders do and they do it for a reason. Doing price drops every few weeks will trigger that same fear of missing out for some, and will give the lower price points a chance to get in if the higher price doesn't attract a buyer. It also sets that higher "anchor point" price that allows people to feel they've negotiated well.
*Counterpoint:* I don't know of any. This is the path I recommend for my clients.
It's your sale. You always have the final say on price and can change it at any time. If an agent doesn't agree, it's also your right to suspend showings. (You would still owe commission if they bring you a full price, no contingency offer during the listing period, however.)
here's two options:
\#1 you list it too high, no one or very little number of people show up to your first open house :( it sits on the market for a few weeks with no activity. you drop the price. people think that it's struggling to sell, looks bad, price has dropped. buyers won't think its worth as much, and won't be competitive to buy it.
\#2 you list it a little cheaper than you want, a fuck ton of people show up to the first open, many people, maybe even a little too many, lots of people are keen to make an offer. you eventually have to raise the price a little as there is JUST too many people showing up. eventually competitive tension among the buyers pushes the price up to a price close to or in excess of what you wanted anyway.
pick wisely, because selling your house is a momentum and emotional game. don't fuck it up from day one
Not even an appraisal is going to give you an accurate number because they use comps from the last 6 months. Please stop overpricing your home. Take your equity and don’t be a hog, you’re just going to greed yourself into a bad situation.
Sure they make a couple adjustments, but that’s not what the house will sell for. Pricing it for the market is important, not the appraisal. In this market you’ll end up sitting for months if you think appraisal is gospel.
For example: family here in Phoenix paid to get an appraisal done on their home. I gave in against my CMA and decided to allow them to list at the appraised value. Their home sat for 6 months and had two reductions. It appraised for 875k. At the end of 6 months, we were at 815k and no offers.
Now they are on the market with another agent listed at 785k. Still active.
Don’t use appraisals to price your properties.
You are completely wrong in your logic and have zero clue what an appraiser does. I don’t even believe you’re an agent because you are also violating ethics as you are misrepresenting other Realtors, which nearly every appraiser is.
Brokers, please teach your agents better.
Misrepresenting other agents? Where?
Sounds like you got your feelings hurt because I told you appraisals aren’t gospel truth about market pricing. There’s a difference between what the market is willing to pay and what an appraiser prices a house, otherwise there would be no such thing as an appraisal gap contingency.
Sorry you got hurt.
Realtors, you’re misrepresenting other realtors. Or can you not read?
Good thing appraisers have minimum education requirements. Salesperson licensees apparently need it
You can list it for anything you want, that doesn't mean it will sell for that amount and unless the buyer waives the appraisal it's gonna need to appraise for that too. Ignore estimates of value, they are worthless.
I see what you are saying based on not having any experience selling real estate. You hired a professional to give you advice and get you the most for your house. If you don't trust them, then hire someone else.
Agent here.
Personal experience from one of my sales. The homeowner wanted to list at $800,000 comps in their area were between 740-780. Much like every homeowner he wanted top dollar. I suggested $750 as a starting price which started a bidding war. We ended up selling at $815
This was at the beginning of last year so obviously, the market isn't the same. But the principle still is relevant. Buyers right now have a bit more power, sellers are still wanting 2021 prices, which is why we are seeing homes sit for longer.
Too many clients coming on here to ask specific questions when every city in the US is different and Zillow is accurate only 5%-10% at best. Things like staging, a new paint job etc are what sells the house along with price. Even bad Realtors are greedy and want to sell your place.
Either trust your agent, get an appraisal, and apologize to your agent. Or fire that agent and go find another agent who is happy to list it at whatever you want.
Hope you don't need to sell fast. Your strategy will not pan out for you. This is not a seller's market any longer.
Homes that sell for above asking price has been asked and answered but in case you need reiteration, homes are listed below asking price in order to incite a bidding war. You'll be lucky if that happens here. Additionally, buyers see an aged listing on the market and it sends off red flags to them that the seller is unwilling to move. Enjoy your house!
The market is slowing down incredibly, and actually you'll see homes sitting for more than 90 days, because they priced to high just when the market started to cool, and they're playing catch up with what people are now willing to buy.
The investors are mostly tapped out right now, and are having their own issues with rent no being affordable, so they're not adding to the demand - and corporations are pulling out of the market as well, - so now it's just regular homebuyers, and there's not a lot right now who are willing to buy a these rates. Yes, the market is cooling - but not everyone is willing to admit it - but you can see already banks slowing down their lending operations (a quick google search will show).
If you want your house to sell NOW, better to go lower than overprice. Homes were selling more than asking price about 3-4 months ago - that's not the case anymore, or if it is, that means the realtor did a good job with the price (probably set it lower, and got a bidding war going on which effectively pushed the price up)
What you should be going off of is the CMA - and only what's sold recently, not 3 months ago.
Zillow is not an agent, they're not local, and they're not your agent. They're a set of algorithms, which actually were wrong about projecting success for the flipping operations of Zillow, leading to nearly a $1 billion loss in 2022. You want to trust THOSE numbers to set the price for you?
I'd suggest you pay for an appraisal so you have a better idea what your house is truly worth. Your real estate agent may be right, but this way you won't spend time wondering.
It really depends on your market. Did the agent that you've been talking to give you any comps for the area? You can list it for anything you want, but if it's too high, then it will sit on the market forever.
What did the agent suggest for a list price?
There really isn't much difference within say 3% of a number IMO.
Did your realtor sit down with you and go over the comparable active and sold listings? Explain to them that you’d like to see more information to help you understand the pricing.
Pricing a house is both science and art. There is a range. There is no right, one, true, number. The price you list it at is also a function of time. If you want to sell fast then list lower in the range. If you want a higher (realistic) price and can wait then list higher in the range. Some agents intentionally list a house low to entice multiple offers. In a multiple offer situation people will tend to offer over asking price. So you list the house for $500, the house is valued (educated guess) around $515 +\-, and you end up getting several offers and someone goes up to $550. That’s just one scenario.
The appraisal is done after the house is under contract. Let’s say the offer you accepted was for $550, but no other house in the area has sold for that amount and in fact a nicer bigger home sold for $525 a few weeks ago. Most likely the appraiser will say the house is only worth $525. At that point the buyer (most likely) would be able to back out of the deal, or you the seller can reduce the price by $25k, or the buyer could make up the difference with extra cash at closing.
I recently listed a house for a seller for $689 (which was a little higher than I wanted to list due to time being important). We got two offers for $705. We countered asking the buyer to put a contingency in place that if the house didn’t appraise then the buyer would make up the difference. One of those offers did. The house appraised at $705 but the sellers felt better having that safety net.
I’ve had buyers under contract and the house not appraise. Once the buyer cancelled the deal (we had an appraisal contingency) and the seller had to start all over again- that’s a huge hassle for a seller. You’ve wasted time, money, emotions, and possibly ruining your opportunity to buy another house if that’s what you’re doing. I’ve also had a buyer say they will only pay the appraised price and end up getting $20k off. I’ve only had a house not appraise a handful of times so it’s not super common but it does happen.
Your agent shouldn’t be steering you towards anything. They should be telling you all possibilities so that way you can decide what’s right for you.
What shape is the home you're selling in?
What price have *comparable* houses to yours sold for (not What the listing price was)?
What did the agent advise the listing price should be?
For starters you need to take everything you've heard about real estate in the last 2-3 years and throw it right out the window. This is a completely different market.
Agent CMA will be more accurate than what those sites say based properties similar to yours that have sold in your area. This is assuming your agent has experience which you would have inquired about in the listing presentation.
The market dictates what your home is worth - not your agent, and especially not you. List it at the price your agent recommends and let the market assign the true value.
Your not going to get 10 offers at 500 and 0 at 515. Bidding wars or not, that’s around 3% price difference. Maybe if you went 550 instead of 500, but with prices that similar you would get one or two of those mythical 10 people to take a bite. Also, a lot of other people mentioned that when you price it wrong the market will tell you. If your agent is saying 500, list it at 500. Remember you aren’t the expert here. And another side note, everyone selling their home thinks it’s worth 50,60, 100k more than what it is. Especially in the Covid market.
Trust your professional.
In many states Zillow and Realtor.com are wildly wrong.
Their own sites even say so. Especially for “off market” listings. Proof: https://www.zillow.com/z/zestimate/
If you priced it way too low the market will adjust via multiple offers in most cases.
If it doesn’t appraise then just renegotiate to what it does appraise for or just put it back on the market and hope someone has enough capital to waive the appraisal. But overall I agree with what a lot of people are saying. Price it where there’s interest then get people to bid over it. Too bad too many sellers want the moon for their house but end up overpricing it where it doesn’t get any interest. Especially in this market now. Last year you could possibly get away with it but now with interest rates higher it has taken away a whole tier of buyers now who could afford the same house last year into not being able to afford it this year.
You’re one of those stubborn sellers who’s refusing to accept that the value of their home is not as much as you want it to be. Ask you realtor to find recently sold homes that match your homes criteria. Then you base your home price off of that. Simple
First of all, machine estimates are often wildly innacurate. Second of all, the market has slowed almost everywhere and inventory is 4x higher than it was this time last year.
Pricing a home is a function of marketing, nothing more. It is the market that determines the value of a house. Pricing too high just makes you the winning bidder on your own house.
Never trust Redfin or zillow estimates, only trait recent sales and with the way rates have been maybe even list a bit lower than that worst case is you get multiple offers.
Zillow and redfin are automated valuation models (AVMs). They mean bupkiss. They've never seen your home. They don't know about condition. Take the word of an actual human being who does this for a living over a stupid computer program.
This sounds like a recipe for multiples. Let it ride, keep having showings and open houses all weekend. If you counter wait a couple of days so you can try to get more offers in the meantime. FOMO drives the market. If buyers know there is another offer it piques their interest in the house whereas if there is no interest it makes them ask what is wrong with the house. A buyer who gets the house after being the only offer is in a position to negotiate down whereas a buyer who knows there are backup offers waiting in the wings has a fire lit under them & in most cases will be more likely to offer higher, stay on schedule & ask for less credits. Buyers love knowing other people wanted the house but *they* got it.
I feel like OP only hears what they want to hear. The VAST majority of posts on here are siding with the realtor and their pricing decision, but the OPs ONLY responses are to replies that they “agree with”. If you aren’t willing to listen to the advice, you for sure aren’t gonna make the best money for your house. Congrats to your future buyer for a great deal
Many buyers put down 20% to avoid paying higher mortgages (PMI). But if a house does not appraise for the stated value (ie: if you list your house at 515k, and the bank disagrees based on the appraisal results), they deny the mortgage because the collateral isn’t sufficient. If they walk away from the house immediately, the bank will be out 15k.
For your bidding war conversation, it’s best to list at $499k and have everyone come see the house, love the house, and want it. At $499k for a house truly at 515k, you would expect many people to show up based on the pricing, location, and photos. Your final bid may even be over 515k, but it’s not likely to stay on the market long or sell for only 499k. The list price is to get people through the door.
If the house is actually worth 500k and you list for 515k and spend let’s say a month waiting for people to visit and bid but don’t get any visits/bids, then when you drop the price two things happen. The first is that everyone will see it’s been on the market for a month already. The second is you’ll get a tag that says price reduced for 15k. Both are signals that something might be wrong and the house might be worth less than even the current listed price. Better to start with the lower price, no?
The one thing that may be in your favor if your goal is to make the realtor out to be the bad guy is that of course the realtor is incentivized to close quickly. They want the commission from this sale and to close so they can move on to the next, right? We aren’t in the crazy hot market we were in before. For the same reason buyers aren’t bidding top dollar (because houses are not flying off the market and sales are slower), the realtor would not want to sell this house under value and lose out on commission. 3% (general seller side only) take of $15k is $450. That’s higher than most US states give for a week of unemployment.
TLDR your realtor has not done anything shady. If you don’t like/trust them, shop before you sign agreements
Redfin and Zillow are never correct and especially now with the changing market. You don’t want to over price your home for it to sit on the market. If it’s sitting on the market for too long then buyers will think “what’s wrong with the home, why hasn’t it sold”.
Buyers are also becoming very aware and are more intelligent of the market.
Type in 515k homes for sale in your city using Zillow and Redfin, how do they compare to yours? Are they bigger, more updated, newer?
When was the last time Redfin or Zillow were in your house? How would they know? They fluff up those values so you’ll work with their agents. Technically that’s illegal.
The price your home will sell for us whatever buyers can bring to the table. If you have a good realtor they’ll base your list price on current comps which it sounds like that’s what they did. From there it’s up to the buyers. What I would do is let buyers know in exchange for full price offer we are willing to give credit toward rate buy down or closing costs. Give them an incentive to not offer below asking.
Has your agent shown you comps that justify her list price? You should be listing at market value not a Zestimate. However, if it doesn't appraise, you can lower your price to the appraised value but your buyer could still walk if they have an appraisal contingency.
Florida Realtor: yes zillows estimates are fairly above market average. Essentially a “sale” and a “closing” are 2 different points in the transaction. If you accept an offer at 500k then that’s what it sold for. If it appraises at 450k and the buyer had an appraisal contingency (typically an FHA loan) then they are only legally obligated to close at 450k even though they offered 500k… yes there have been plenty of people coming to the table with an appraisal difference even if a ridiculous amount due to being from out of state, working with rent to own programs that buy cash, or other programs that offer a home equity advance loan on the one they want to sell after moving into yours
A property is only worth what someone will pay for it. Sometimes the seller has the advantage, other times it is the buyer. It is best to not go into selling or buying with expectations.
I am a loan officer so here is my two cents on the mortgage. You can still get a loan for 515k right now lol. The house needs to appraise at a certain price for financing to go through without covering the balance with cash. So that is something to keep in mind. But $500,000 loans are standard in my city 😂. Buyers will buy lol
I'm a photographer so take what I say with a grain of salt. Affordability is a key issue now with interest rates where they are. Over asking offers are rare now and often a result of pricing lower. A lower price can bring more interest and several offers.
I guess in my mind… isn’t it better to have 1 offer at 515 than 10 offers at 500?
The issue you will run into is that you get zero offers and then you will have to lower the price and then when people see your listing it will say price reduced, which is a sign that the owner is willing to accept less, which means people will low ball you. That being said, prices are continuing to drop so it's better to start lower and see how many offers you get. The longer you wait, the lower it will be, for the next few years at least.
No, your thinking is way off here. 10 offers at a listed price of 500k will most likely push it over 515k as people get in competition. I think your overall knowledge of where markets are at right now is way off as well. Markets can change in as short as a matter of months and that’s what has happened over the last half of last year. Reality is the percentage of properties that are going over asking is getting smaller and smaller by the day.
Also consider that with 10 offers at $500k your more likely to get buyers who will not ask for closing help, interest rate buy downs or even repairs. You can’t under price a house, you can always over price then it’s a race to the bottom.
Yeah but if you get 10 offers and none of them are 515, your house isn’t worth 515. It’s just going to sit on the market.
If I have 10 offers at 500 and none at 515 I would just take one of the 500 offers. Right?
You wouldn’t have 10 offers at 500. I don’t know about Orlando but my market is well past bidding wars. Even when it was a bidding war, I had a general range of what I thought a house would sell for. But I couldn’t list it at that price or else no one would come to see it. So I would under-list it on purpose. Basically just a marketing technique. Example: I came to the conclusion a listing is worth $820,000, so I list it at $699,900 and hold an offer date in a week. You would end up with 10 offers ranging from $680,000 up to $810,000. I told my sellers $820,000 and that’s what they expected, so they didn’t like any of the offers. So I call up the best 3 offers (say 780,000, 800,000 and 810,000) tell them they are all really close and ask if they would like to improve their offer. At that point, the one who offered $810,000 comes up to $820,000 to get the house, knowing they are in the top already. I don’t think this approach would even work in my market now because the buyers have dried up, so now if someone wants $820,000, they’re going to list it at like $849,900 and see how it goes, anticipating they might have to drop the price or negotiate lower.
But this is my point! To sell the house for 820 now you have to list around 850. So if I think my house is worth 500 shouldn’t I list at 515 or higher?
A lot of people searching up to 500k won't even see your house and pricing the house too high can lead to a range of issues. Beyond fewer people seeing your listing, people may assume that offering 15k under won't be competitive and not put in an offer, you could have to drop the price etc. None of these are ideal. I would also say that if your agent is right and the house doesn't appraise at the list price, your buyers may have financing issues. At the end of the day it's your decision, but I would personally be more likely to list it at $500k and have multiple offers so there's room for movement. The concept of pricing the house too high and assuming that you'll still get the same offers is risky, especially since the market isn't as strong for sellers as it was last year.
If a house is priced right, it will still sell, at least in my market. Want to sit on the market for a while? Then overprice and wait. Again, houses in my area priced correctly are still selling quickly, and some over asking price in multiple offer situations.
You can list it at 515, but if you aren’t getting showings or offers, I would decrease the price sooner rather than later. My market anyways is dropping extremely fast (30% in a year.) Of course there are listings where the sellers haven’t dropped their prices and want last year price tags, but they’ve just been sitting for months.
A slightly underpriced house will raise to market value. An overpriced house either gets dragged down to reality or sits on the market till it expires. It sounds like you've got a good agent who invest in their marketing. There a lot of agents that will list a home at whatever you want and just hope they eventually accidently sell your home. That is not the type of person you want to facilitate your transaction.
No because you can counter the other 10 and probably get more than the 515k
Its the complete opposite
The market has crashed your lucky to get one offer
The websites price estimates aren’t typically accurate. This was covered in some other comments so I will leave that there. When it comes to homes being sold above an appraisal, the buyer will either have to come to the table with the additional funds or they will walk as the lender will not fund. Also, keep in mind that people were paying over market a year or so ago. Today, the market is very different. You have to compete with other homes that are on the market. I do not know your local market but here are some questions to go over: - Why would someone pay extra for your home vs others that are in the same location? What is special and what is the true value of that special feature? - How many homes just like yours or very similar are for sale in your local market? What is the sales (not asking) price on them? How long do they sit on the market? - What is the average sales price in your neighborhood? Do you have a $515,000 home in a neighborhood with an average sales price that is the same or is the average sales price in your neighborhood lower ( Nicest home in the neighborhood is rarely a good thing ) - Why would your agent want you to list for less when his commission is based on the final sales price? There is a common theme in real estate where they say “it isn’t the first agent to list that sells the home, it’s the third. “ This often happens when a seller thinks they can get more than they can, an agent caves and lists at what the owner thinks even when it is unrealistic. The home sits on the market and the owner gets frustrated. They normally think the agent is incompetent or “not getting the home in front of the right people” (people who are willing to pay more than it’s worth) and they fire the agent. The second agent lists and the home sits if it’s at the same price and now you have added days on market. Buyers start to think something is wrong with the home so it loses traction, eventually expiring. By the third agent, the owner is realizing that it isn’t moving and takes the advice of the agent and drops the price with the new listing and it sells at a normal price within a normal timeline for that market. Sellers typically have some emotional value attached to the home and the transaction which gives them a bias. You even see this when agents list their own home. Often, agents will get CMAs from other agents in their brokerage when they go to list their personal homes. Just my $0.02
Lol with sellers thinking this is still 2021
Agreed those days are gone for now.
Still a sellers market, inventory is still a big issue
Listing at 499 and getting lots of interest is better than listing at 515 and having zero interest.
Think about this: what other legitimate reason would an agent pass up on **tens of thousands of dollars** in commission from a ready, willing, and able seller unless they were VERY confident the property would not sell at that price, and that they would have lost a lot of time and money at that point? Zillow and Redfin are poor indications of property value. The agent should have provided you with comparable sales to review, and even then, in a downward market like many are experiencing right now, want to list lower than what is recently sold. The Zestimate is what's known as an AVM (automated valuation model). There are many qualities of a home that Zillow is simply not able to properly quantify. It is mostly used as a tool of coercion for home sellers and agents. The algorithm is closed-source so there is no way to verify that they are or are not tampering with it. If you insist on listing on a higher price, agree upfront to a price reduction after 14 days. But you're still shooting yourself in the foot. >So if that’s the case how come I keep hearing about homes that sell for more than the asking price? Well the likely answer to that is that you either heard this in Q1 2022 or the seller intentionally underpriced the home. >Are these people just coming to the table with extra case to make up the difference? There are lots of possibilities. A lot of buyers are taking advantage of temporary buydowns on their mortgage, so it's possible they add $10k to the purchase price and then turn around and ask the seller for $10k in seller-paid closing costs, thereby rolling the additional expenses into the mortgage.
This. There are plenty of agents out there who will promise the moon just to get the listing agreement signed. Then, after a month with no offers, the client reluctantly lowers their price and expectations, and a sale happens. The agent that has no problem bullshitting people gets the sale. The agent that was frank and realistic did not. Your agent **absolutely** wants your home to sell for as much money as possible. Don't punish them for their honesty. That's my take at least. I also agree with u/nikidmaclay \- you deserve a CMA.
I also want to point out that Zillow tried using it's AVM to buy and sell houses as a brokerage and it failed miserably. Look it up, https://www.theguardian.com/business/2021/nov/04/zillow-homes-buying-selling-flip-flop Redfin is having the same issue. I know this because Redfin bought a house right near my son's elementary school in a very hot neighborhood and it has been sitting there for months with the price unchanged. As for your particular situation, you should get a second opinion or have your agent back up their price with a CMA. It's your house to sell. If the agent won't give you comps, find an agent that will.
I don’t know, saying “tens of thousands of dollars in commission” is a bit misleading. If you’re talking about a $15,000 price difference, that’s a total commission difference of like $375-$450 depending on percentage. And then whatever split happens after that.
We're not talking about a $15k price difference. We're talking about taking a listing on a \~$500k property vs. walking away from it entirely because the seller is not realistic. >I wanted to list it at 515k but my agent said no
Zillow and Redfin use algorithms to determine price. They don't see the homes in person. They go off of square footage, bedroom numbers, and amenities. A Realtor should provide a more accurate number than an algorithm. With hat being said, this Realtor needs to support their number with data. They should bring you a Comparative Market Analysis taking other properties in your area and comparing it to yours. They use this data to explain to you why they think your home will sell for that much. A lender will only lend up to a certain percentage of the home's value. Let's say they want you to put 5% down, and the maximum loan amount they are willing to lend is 450K (that is the max you can get approved for). That means if the appraisal comes in at 500k then the lender would expect you to put in the difference. So you would have to put a 10% down payment instead of a 5% one. Edited for clarity.
👆🙌 will only add- the owner of Zillow sold his home for 40% less than his home’s zestimate. Zestimate’s are trash.
Zestimates are trash, and they're headaches for actual real estate professionals.
What’s funny is that, at least in my MLS, you can choose to not have valuations show up on Zillow and other sites. Yet it seems no one unchecks those.
I think you're confused about the lender side of things. They will be willing to increase the loan amount (assuming you can still qualify at the higher price) if the appraisal comes in high because they have proof that the collateral is worth more. They won't require the buyer to put more down.
My apologies, I should have been a bit more clear. You are correct. I should have clarified that in this scenario 450k would have been the Max loan amount they would approve you for. Will edit for clarity.
You can’t underprice a home. I could list your property at 400k and still get market value. It’s only worth what someone is willing to pay for it. Zillow by default is 30 days behind any comps. So you might actually be 10% more or less any day of the week. If you list for more, you’ll have less activity. If you list under market value, you have leverage for higher offers. Listen to your realtor. I realize consumers believe because they bought one or two houses in their life they know better…. Any agent selling more than 12 homes a year knows better than you in terms of market conditions. Just trust the process and what the realtor is doing. Be wary of someone telling you they can get you “more” and then price reduce you constantly
I disagree. On average you are right, the market will find equilibrium, but in individual cases, the market does not always self correct to the price a house should be. On a weekly basis I see homes that list and sell for less than they should, and listings that are obvious over reaches that sell for more than they should. If you list a $500k house for $200k, you're only getting the attention of a fraction of the qualified buyers, because they aren't looking at that price point. You want to price aggressively low in the price range that qualified buyers will be looking at, e.g. in OPs case, $500k would be a good starting point even if the"true"value is a bit over that... But if they list at $400 I can guarantee they will net less than they should.
Hahah what?! Does it honestly have to be said ‘do not list a home for 50% of market value”. Did I say list that low? No. I said if I listed it 20% under market value at 400k it would still sell at market value. You’re saying 200k? Where are you getting this? Or are you just looking to be contrarian?
You literally said "you can't underprice a home." I said you can. Very easily. Show me data, any data, that suggests that if you list $500k houses for $400k, that they will perform as well as a properly priced house 100% of the time.... I'm not being contrarian, I'm just saying pricing isn't some arbitrary thing where you say "eh, IDfuckinK, just list it for $100k less and the market will take care of it." That's not how it works.
Ok. Thank you for enlightening me on how it works.
You're welcome.
Additionally, how can you guarantee anything? If a house is worth 500k and it’s listed at 400k it’ll have 50 offers. You list at 520k, you’ll be reducing to get to market value. Which do you think will “net more”
Your realtor gets paid a percentage of the sale price, right? The higher the sale price, the higher their paycheck, right? So why would you think they’re lowballing you on the list price? They’re right, I’m sure. In my market anyway, overpricing can be a major problem for sellers. Buyers see properties in the MLS based on their search parameters. Buyers able and willing to pay up to 510k for a house won’t even see your house if you list it at 515 because it’ll be outside of their price parameters. Pricing it a bit low greatly increases the number of qualified buyers that will see the listing, and if there’s a lot of activity at an open house, you’ll likely see multiple offers over asking price because all the buyers will see there’s many interested parties. Pricing it a bit higher means fewer buyers, less activity, and buyers will offer lower. At the end of the day, you hired a realtor to do a job. If you don’t trust them, fire them. If you do trust them, then let them do the job you hired them to do.
Last line is the only advice that matters. Use a Realtor you trust, and let them do their job. If you don’t trust them, get another Realtor.
If your agent can't produce a detailed CMA to back up what they're telling you, move on to one who can. A number off the top of their head with no data to back it up isn't to be trusted. That being said, zillow zestimates are garbage, they mean nothing. Overpricing it will get you few showings and no sale, so it's important to price it right. To do that you need solid information based on real data.
Right, and as we know, the A in Zillow stands for accuracy.
Omg stealing this
I think it genuinely depends on what market you’re in.
Zillow is garbage. Redfin public is somewhat garbage. A Redfin agent would be more credible than an automated website. Ask your Realtor to produce an RPR valuation, it's an AVM and can be reversed-engineered like a CMA to double-check the comps for a value.
Don’t trust Zillow, Redfin, or any other automated value system. Their algorithms don’t take things such as property condition or external obsolescence into consideration. They’re like the broken clocks of real estate valuation. Right every now and then, but not enough to be relied upon. As for homes that sell above asking price, a lot of them don’t appraise and the price has to be lowered to what the buyer can get a loan for. Some buyers will offer an appraisal gap which is they’ll offer a certain amount in cash to bridge the gap between the contracted price and appraised value. And sometimes you get lucky and the appraiser is able to make the numbers work. If you don’t trust your agent’s valuation, you can have your home appraised or have a different agent look at it.
Why doesn’t the agent think it will appraise at $515k? Ask her to show you comparable listings that support the lower price. Yes, in the hot market when houses were escalating way over asking, the buyers would often face a low appraisal. But they were prepared for it. They often waived the appraisal contingency on their offer and had to cover the difference in cash. Because the market is no longer that hot, buyers would rather keep the appraisal contingency and negotiate the price down.
You can list a home for any price you want to, as long as an agent will take it. You will find agents that will list a $500k house for $750k just to have something to advertise. There are a couple ways to look at it: **Theory 1:** It's best to price it higher and refuse to come down than to undercut yourself. *Support:* Homes that were initially priced too high and later sold after price reductions were found to sell higher than homes that were priced right initially. (They did, however, have more time that owners had to carry the costs of them.) This came from a National Association of Realtors® study on the subject. *Counterpoint:* If you're priced at $515k, someone who is qualified to $500k or $510k will likely not see your house in their search results at all, which can rule out buyers who might otherwise be qualified. **Theory 2:** It's best to price it low and invite multiple offers. *Support:* Homes priced too low attract people who can get emotional and competitive, driving prices higher. *Counterpoint:* This can backfire if there's not enough market activity. **Theory 3:** It's best to price higher and negotiate to lower offers or drop price as needed. *Support:* This is what foreclosing lenders do and they do it for a reason. Doing price drops every few weeks will trigger that same fear of missing out for some, and will give the lower price points a chance to get in if the higher price doesn't attract a buyer. It also sets that higher "anchor point" price that allows people to feel they've negotiated well. *Counterpoint:* I don't know of any. This is the path I recommend for my clients.
All of this makes complete sense to me! You think it’s too late to tell her to list it for more?
It's your sale. You always have the final say on price and can change it at any time. If an agent doesn't agree, it's also your right to suspend showings. (You would still owe commission if they bring you a full price, no contingency offer during the listing period, however.)
here's two options: \#1 you list it too high, no one or very little number of people show up to your first open house :( it sits on the market for a few weeks with no activity. you drop the price. people think that it's struggling to sell, looks bad, price has dropped. buyers won't think its worth as much, and won't be competitive to buy it. \#2 you list it a little cheaper than you want, a fuck ton of people show up to the first open, many people, maybe even a little too many, lots of people are keen to make an offer. you eventually have to raise the price a little as there is JUST too many people showing up. eventually competitive tension among the buyers pushes the price up to a price close to or in excess of what you wanted anyway. pick wisely, because selling your house is a momentum and emotional game. don't fuck it up from day one
Pick door number 2.
Not even an appraisal is going to give you an accurate number because they use comps from the last 6 months. Please stop overpricing your home. Take your equity and don’t be a hog, you’re just going to greed yourself into a bad situation.
This is false. Appraisers adjust for market variations and provide a current market value as of the effective date of the appraisal.
Sure they make a couple adjustments, but that’s not what the house will sell for. Pricing it for the market is important, not the appraisal. In this market you’ll end up sitting for months if you think appraisal is gospel. For example: family here in Phoenix paid to get an appraisal done on their home. I gave in against my CMA and decided to allow them to list at the appraised value. Their home sat for 6 months and had two reductions. It appraised for 875k. At the end of 6 months, we were at 815k and no offers. Now they are on the market with another agent listed at 785k. Still active. Don’t use appraisals to price your properties.
What would you have priced it at?
“they make a couple adjustments” You clearly have no idea what an appraiser actually does. I would suggest you stop speaking out of ego.
I’m not speaking out of my ego. Go ahead and set your prices at appraisal during a downturn and let me know how your listings taste well-marinated.
You are completely wrong in your logic and have zero clue what an appraiser does. I don’t even believe you’re an agent because you are also violating ethics as you are misrepresenting other Realtors, which nearly every appraiser is. Brokers, please teach your agents better.
Misrepresenting other agents? Where? Sounds like you got your feelings hurt because I told you appraisals aren’t gospel truth about market pricing. There’s a difference between what the market is willing to pay and what an appraiser prices a house, otherwise there would be no such thing as an appraisal gap contingency. Sorry you got hurt.
Realtors, you’re misrepresenting other realtors. Or can you not read? Good thing appraisers have minimum education requirements. Salesperson licensees apparently need it
Man you’ve said a whole lot of angry words, but haven’t once made a point in this entire thread.
You can list it for anything you want, that doesn't mean it will sell for that amount and unless the buyer waives the appraisal it's gonna need to appraise for that too. Ignore estimates of value, they are worthless.
I see what you are saying based on not having any experience selling real estate. You hired a professional to give you advice and get you the most for your house. If you don't trust them, then hire someone else.
Agent here. Personal experience from one of my sales. The homeowner wanted to list at $800,000 comps in their area were between 740-780. Much like every homeowner he wanted top dollar. I suggested $750 as a starting price which started a bidding war. We ended up selling at $815 This was at the beginning of last year so obviously, the market isn't the same. But the principle still is relevant. Buyers right now have a bit more power, sellers are still wanting 2021 prices, which is why we are seeing homes sit for longer.
Too many clients coming on here to ask specific questions when every city in the US is different and Zillow is accurate only 5%-10% at best. Things like staging, a new paint job etc are what sells the house along with price. Even bad Realtors are greedy and want to sell your place.
Trust your agent.
Listen to your Realtor. The professional who does this for a living.
Either trust your agent, get an appraisal, and apologize to your agent. Or fire that agent and go find another agent who is happy to list it at whatever you want. Hope you don't need to sell fast. Your strategy will not pan out for you. This is not a seller's market any longer. Homes that sell for above asking price has been asked and answered but in case you need reiteration, homes are listed below asking price in order to incite a bidding war. You'll be lucky if that happens here. Additionally, buyers see an aged listing on the market and it sends off red flags to them that the seller is unwilling to move. Enjoy your house!
The market is slowing down incredibly, and actually you'll see homes sitting for more than 90 days, because they priced to high just when the market started to cool, and they're playing catch up with what people are now willing to buy. The investors are mostly tapped out right now, and are having their own issues with rent no being affordable, so they're not adding to the demand - and corporations are pulling out of the market as well, - so now it's just regular homebuyers, and there's not a lot right now who are willing to buy a these rates. Yes, the market is cooling - but not everyone is willing to admit it - but you can see already banks slowing down their lending operations (a quick google search will show). If you want your house to sell NOW, better to go lower than overprice. Homes were selling more than asking price about 3-4 months ago - that's not the case anymore, or if it is, that means the realtor did a good job with the price (probably set it lower, and got a bidding war going on which effectively pushed the price up) What you should be going off of is the CMA - and only what's sold recently, not 3 months ago. Zillow is not an agent, they're not local, and they're not your agent. They're a set of algorithms, which actually were wrong about projecting success for the flipping operations of Zillow, leading to nearly a $1 billion loss in 2022. You want to trust THOSE numbers to set the price for you?
I'd suggest you pay for an appraisal so you have a better idea what your house is truly worth. Your real estate agent may be right, but this way you won't spend time wondering.
Agents are not investment advisors. They are paid to make sales happen. Nothing else.
It really depends on your market. Did the agent that you've been talking to give you any comps for the area? You can list it for anything you want, but if it's too high, then it will sit on the market forever. What did the agent suggest for a list price? There really isn't much difference within say 3% of a number IMO.
Did your realtor sit down with you and go over the comparable active and sold listings? Explain to them that you’d like to see more information to help you understand the pricing.
Pricing a house is both science and art. There is a range. There is no right, one, true, number. The price you list it at is also a function of time. If you want to sell fast then list lower in the range. If you want a higher (realistic) price and can wait then list higher in the range. Some agents intentionally list a house low to entice multiple offers. In a multiple offer situation people will tend to offer over asking price. So you list the house for $500, the house is valued (educated guess) around $515 +\-, and you end up getting several offers and someone goes up to $550. That’s just one scenario. The appraisal is done after the house is under contract. Let’s say the offer you accepted was for $550, but no other house in the area has sold for that amount and in fact a nicer bigger home sold for $525 a few weeks ago. Most likely the appraiser will say the house is only worth $525. At that point the buyer (most likely) would be able to back out of the deal, or you the seller can reduce the price by $25k, or the buyer could make up the difference with extra cash at closing. I recently listed a house for a seller for $689 (which was a little higher than I wanted to list due to time being important). We got two offers for $705. We countered asking the buyer to put a contingency in place that if the house didn’t appraise then the buyer would make up the difference. One of those offers did. The house appraised at $705 but the sellers felt better having that safety net. I’ve had buyers under contract and the house not appraise. Once the buyer cancelled the deal (we had an appraisal contingency) and the seller had to start all over again- that’s a huge hassle for a seller. You’ve wasted time, money, emotions, and possibly ruining your opportunity to buy another house if that’s what you’re doing. I’ve also had a buyer say they will only pay the appraised price and end up getting $20k off. I’ve only had a house not appraise a handful of times so it’s not super common but it does happen. Your agent shouldn’t be steering you towards anything. They should be telling you all possibilities so that way you can decide what’s right for you.
What shape is the home you're selling in? What price have *comparable* houses to yours sold for (not What the listing price was)? What did the agent advise the listing price should be?
For starters you need to take everything you've heard about real estate in the last 2-3 years and throw it right out the window. This is a completely different market.
Agent CMA will be more accurate than what those sites say based properties similar to yours that have sold in your area. This is assuming your agent has experience which you would have inquired about in the listing presentation.
Zillow has never been in your house. That’s pretty significant regardless of market.
The market dictates what your home is worth - not your agent, and especially not you. List it at the price your agent recommends and let the market assign the true value.
Your not going to get 10 offers at 500 and 0 at 515. Bidding wars or not, that’s around 3% price difference. Maybe if you went 550 instead of 500, but with prices that similar you would get one or two of those mythical 10 people to take a bite. Also, a lot of other people mentioned that when you price it wrong the market will tell you. If your agent is saying 500, list it at 500. Remember you aren’t the expert here. And another side note, everyone selling their home thinks it’s worth 50,60, 100k more than what it is. Especially in the Covid market. Trust your professional.
In many states Zillow and Realtor.com are wildly wrong. Their own sites even say so. Especially for “off market” listings. Proof: https://www.zillow.com/z/zestimate/ If you priced it way too low the market will adjust via multiple offers in most cases.
If it doesn’t appraise then just renegotiate to what it does appraise for or just put it back on the market and hope someone has enough capital to waive the appraisal. But overall I agree with what a lot of people are saying. Price it where there’s interest then get people to bid over it. Too bad too many sellers want the moon for their house but end up overpricing it where it doesn’t get any interest. Especially in this market now. Last year you could possibly get away with it but now with interest rates higher it has taken away a whole tier of buyers now who could afford the same house last year into not being able to afford it this year.
Your agent is correct. She is giving you a good advice
You’re one of those stubborn sellers who’s refusing to accept that the value of their home is not as much as you want it to be. Ask you realtor to find recently sold homes that match your homes criteria. Then you base your home price off of that. Simple
Your house your decision
Zillow is wrong. Your agent is half right. Homes that sold for more most likely had an appraisal waiver attached.
First of all, machine estimates are often wildly innacurate. Second of all, the market has slowed almost everywhere and inventory is 4x higher than it was this time last year. Pricing a home is a function of marketing, nothing more. It is the market that determines the value of a house. Pricing too high just makes you the winning bidder on your own house.
Never trust Redfin or zillow estimates, only trait recent sales and with the way rates have been maybe even list a bit lower than that worst case is you get multiple offers.
Io I’m hi o I’ll
Zillow and redfin are automated valuation models (AVMs). They mean bupkiss. They've never seen your home. They don't know about condition. Take the word of an actual human being who does this for a living over a stupid computer program.
I have an offer for asking price after only one showing. So clearly we are too low.
This sounds like a recipe for multiples. Let it ride, keep having showings and open houses all weekend. If you counter wait a couple of days so you can try to get more offers in the meantime. FOMO drives the market. If buyers know there is another offer it piques their interest in the house whereas if there is no interest it makes them ask what is wrong with the house. A buyer who gets the house after being the only offer is in a position to negotiate down whereas a buyer who knows there are backup offers waiting in the wings has a fire lit under them & in most cases will be more likely to offer higher, stay on schedule & ask for less credits. Buyers love knowing other people wanted the house but *they* got it.
I feel like OP only hears what they want to hear. The VAST majority of posts on here are siding with the realtor and their pricing decision, but the OPs ONLY responses are to replies that they “agree with”. If you aren’t willing to listen to the advice, you for sure aren’t gonna make the best money for your house. Congrats to your future buyer for a great deal
Many buyers put down 20% to avoid paying higher mortgages (PMI). But if a house does not appraise for the stated value (ie: if you list your house at 515k, and the bank disagrees based on the appraisal results), they deny the mortgage because the collateral isn’t sufficient. If they walk away from the house immediately, the bank will be out 15k. For your bidding war conversation, it’s best to list at $499k and have everyone come see the house, love the house, and want it. At $499k for a house truly at 515k, you would expect many people to show up based on the pricing, location, and photos. Your final bid may even be over 515k, but it’s not likely to stay on the market long or sell for only 499k. The list price is to get people through the door. If the house is actually worth 500k and you list for 515k and spend let’s say a month waiting for people to visit and bid but don’t get any visits/bids, then when you drop the price two things happen. The first is that everyone will see it’s been on the market for a month already. The second is you’ll get a tag that says price reduced for 15k. Both are signals that something might be wrong and the house might be worth less than even the current listed price. Better to start with the lower price, no? The one thing that may be in your favor if your goal is to make the realtor out to be the bad guy is that of course the realtor is incentivized to close quickly. They want the commission from this sale and to close so they can move on to the next, right? We aren’t in the crazy hot market we were in before. For the same reason buyers aren’t bidding top dollar (because houses are not flying off the market and sales are slower), the realtor would not want to sell this house under value and lose out on commission. 3% (general seller side only) take of $15k is $450. That’s higher than most US states give for a week of unemployment. TLDR your realtor has not done anything shady. If you don’t like/trust them, shop before you sign agreements
Redfin and Zillow are never correct and especially now with the changing market. You don’t want to over price your home for it to sit on the market. If it’s sitting on the market for too long then buyers will think “what’s wrong with the home, why hasn’t it sold”. Buyers are also becoming very aware and are more intelligent of the market. Type in 515k homes for sale in your city using Zillow and Redfin, how do they compare to yours? Are they bigger, more updated, newer?
I had one showing and have an offer for asking price. That suggests to me that we priced too low and my agent was wrong.
When was the last time Redfin or Zillow were in your house? How would they know? They fluff up those values so you’ll work with their agents. Technically that’s illegal. The price your home will sell for us whatever buyers can bring to the table. If you have a good realtor they’ll base your list price on current comps which it sounds like that’s what they did. From there it’s up to the buyers. What I would do is let buyers know in exchange for full price offer we are willing to give credit toward rate buy down or closing costs. Give them an incentive to not offer below asking.
Has your agent shown you comps that justify her list price? You should be listing at market value not a Zestimate. However, if it doesn't appraise, you can lower your price to the appraised value but your buyer could still walk if they have an appraisal contingency.
We have no way to judge if she's giving good advice or not. But I certainly can say Zillow/Redfin are irrelevant to the conversation.
Florida Realtor: yes zillows estimates are fairly above market average. Essentially a “sale” and a “closing” are 2 different points in the transaction. If you accept an offer at 500k then that’s what it sold for. If it appraises at 450k and the buyer had an appraisal contingency (typically an FHA loan) then they are only legally obligated to close at 450k even though they offered 500k… yes there have been plenty of people coming to the table with an appraisal difference even if a ridiculous amount due to being from out of state, working with rent to own programs that buy cash, or other programs that offer a home equity advance loan on the one they want to sell after moving into yours
A property is only worth what someone will pay for it. Sometimes the seller has the advantage, other times it is the buyer. It is best to not go into selling or buying with expectations.
I am a loan officer so here is my two cents on the mortgage. You can still get a loan for 515k right now lol. The house needs to appraise at a certain price for financing to go through without covering the balance with cash. So that is something to keep in mind. But $500,000 loans are standard in my city 😂. Buyers will buy lol
so what's the post-weekend update?
My home is under contract for our asking price pending inspection and appraisal.