Over the last month my buyers have seen the rejection stamp from more than one seller. In fact it seems they are collecting them in larger numbers than they did in 2003. Of course then it was because the offer didn’t escalate enough to be the highest bidder. Now the rejection stamp is coming because the offers are deemed to be to low to be a fair price for the property.
Last July when the market showed that it was going to slide downward and the first indications of lowering values really became apparent I penned a post entitled “You Want to Offer me What?” At the time it seemed like good advice to sellers who had their homes listed at “above market” values. Today the advice is just as valid and perhaps with added twists that weren’t apparent then.
Neighborhoods where foreclosure properties are rampant, neighborhoods where the builder is slashing prices to sell inventory and homes that are surrounded on either side by mega mansions are just a few examples of where last years prices are not going to hold up to buyer’s scrutiny in 2008. And that is before the buyer opens the door to your home. Once a buyer is inside if your price doesn’t reflect the condition of your home you can see the calculators working in their heads. But you say I just added a fantastic Jacuzzi tub, new bathroom tile and freshly painted the house! Did you over improve the house for the value of the neighborhood? Sometimes you can go too far and the value of what you added doesn’t add up to an over inflated price.
No matter how you cut it this market is hard for sellers to wrap their arms around. However homes are selling. Buyers today are savvier than ever. They know the value of the home; they’ve done the research and with the guidance of a good buyer’s agent are making realistic offers. Sellers who understand this end up with contracts, sometimes multiple and they are able to move on. For sellers who are still holding out hope for prices from the past they are finding it easy to stamp rejected on an offer and wait for the next one. And wait and wait and wait.
So sellers before you pull out that rejection stamp take another look at the offer in front of you. It might be painful to see but it might also be closer to reality than you know.