Like humans, all properties have their faults.
There is no ‘perfect’ home. Even at $7,000,000 in Stonnington you won’t necessarily get a garage or North orientation.
When a house is struggling to sell with limited interest, it can be tempting to focus on its shortcomings to justify or explain the lack of buyer engagement.
But this would be ignoring the elephant in the room… Price.
It always comes down to price.
One of our colleagues recently sold a house that had languished on the market for 161 days.
The property had been viewed online over 25,000 times, resulting in 100 groups inspecting in dribs and drabs across 30 open homes. That is to say, the house had been more than adequately exposed and inspected.
Yet they had not received a single genuine offer that was worth considering that entire time.
Furthermore, the asking price had been reduced several times in small increments of $10,000 or $20,000, which hadn’t helped. Enquiry was still non-existent and the one or two buyers coming through each week walked away with no desire to own the home.
Buyers were critical of the floor plan. The bathroom was in the wrong spot. There was no indoor/outdoor flow. None of the bedrooms had robes. Money needed to be spent.
None of these issues was terminal, it was still an attractive period home in a great location in excellent condition.
But buyers weren’t interested. Not one. There was zero enthusiasm and engagement.
Eventually the vendors realised that something needed to change if they were going to achieve a sale so they agreed to a more aggressive price adjustment of five percent.
Within hours of the price being adjusted online the agent’s phone started to ring. 10 enquiries were received within the first 24 hours. Buyers who had been tracking the property online or who had inspected months ago re-engaged wanting to reinspect.
The new buyers coming through saw the potential, the ways to add value. They looked past the lack of robes and position of the bathroom. They imagined knocking out the wall between the living room and kitchen and opening up the space.
Needless to say the property sold within 48 hours with multiple offers.
Buyers get excited by value. It’s human nature.
Who is disciplined enough to choose the medium popcorn at the movies for $7 when the large is three times bigger for an extra dollar? Not me.
The more attractive the price, the more the perceived value, the more forgiving the buyer is of the property’s shortcomings.
The paradox is that a property that is priced below market value will often end up achieving a price above the odds, whereas a property that is priced above market value will end up achieving a sub par result, if it sells at all.
This is why getting the pricing strategy right from the onset is one of the most challenging aspects of our job.
Get it wrong and you’re either (unintentionally) underquoting or at risk of not selling.
Feature Image: 68 Oban Street, South Yarra