Most sellers are happy to wait their turn, and have no worry about selling. It will happen some day.
But for the folks who recognize that they might have shot too high on their initial price, what do you do now? You don’t want to give it away…..and you have time. Besides, it’s only April.
When do you lower the price? And by how much?
If you’re in an area and/or price range that is looking a bit glutty, then let’s work it backwards. The other listings around you that aren’t selling will start lowering their price once summer approaches – call it June 1st.
However, you want to beat them to it, in case there is only one buyer left at these price points (it could be).
And you don’t know if your next price reduction will be your last.
It makes sense to lower now, and then if that wasn’t enough, then hit it again in mid-May. You should find the next buyer before your neighbor gets around to his first price reduction.
How much lower?
My basic rule-of-thumb:
- If you are getting offers, your price has to be close – probably within 5%. Call the last offer back and re-consider his best offer!
- If you are getting showings but no offers, then your price is 5% to 10% too high. Lower 5% to see if that’s enough (it might not be enough).
- If you aren’t getting any showings, then your price has to be 10% too high. There aren’t enough active listings for you to not get lookers. Lower by at least 5%, and keep doing it until you get offers.
If you are content with your price and not in a rush, then ignore the above. But if you want a formula to get you on your way, give it a try.
Lower your price by 5%, and see what happens!