When you look at listings for homes online, they usually have a part of the listing that shows how long the home has been on the market. After 90 days, most real estate agents deem that property as "stale." This stale property may get less money when it finally does sell. Why? Many buyers see a longer time spent on the market and make assumptions that there's something incredibly wrong with the home. After all, it's human to dislike something that everyone else dislikes. Many home buyers see a longer time on the market and assume that the other home buyers who viewed the property and weren't interested know something that they don't, and just ignore the home altogether. However, most real estate agents will tell you that it's less likely that the home has major problems or the home of a serial killer and more likely something to do with the economy or the home's pricing. Here are some of the main reasons a home has gone "stale."
Price is Too High
What's the main cause of a home sitting on the market for forever? The listing price is too high. Every home will sell at the right price, and if it's the wrong price, then it will just sit on the market for forever. Buyers most likely jumped when the home was put on the market, and after seeing the property, decided to buy something that was a better value. Luckily, a home seller with a home on the market for a longer time may be willing to negotiate more on the final price of a home.
Along with this high listing price, the seller may be stubbornly refusing to lower the listing price. Many times, Zillow says, the first offer on a home comes and the buyer is stubborn on the price. The buyer leaves and the house sits on the market and when the seller finally agrees to a price, it's usually 5% less than the first offer they received. Sellers should be willing to negotiate their prices in order to get their home off the market.
Hard to Show
Sometimes the home just doesn't show well. The seller may need professional designer or staging help. Other sellers need to open their schedules to let potential buyers view the property. If a home is sitting on the market for months, the seller may have a hard time getting the home ready to show or making sure their schedule is clear. If the seller wants the home to sell fast, they should leave the property and let potential buyers come through the home.
It was FSBO and a Realtor took it Over
Sometimes home sellers try to sell their home themselves as a FSBO. Many times these stay on the market for months, simply because home sellers can't make time to show the home because they're at work. A realtor may have taken over the listing when the FSBO gave up on selling the home.
Housing Market may be Bad
A long time on the market may have nothing to do with the house itself "“ it may just be the economy or housing market. Gracee Arther from Ewing and Associates said that more times the long market homes have less to do with the home's condition and more to do with the housing market.
The Home is in Bad Condition
If worse comes to worse, the home may actually be in bad condition. Sometimes sellers want to offer buyers credit for repairs that they don't want to do themselves. This usually keeps buyers away from the home "“ they don't want to have to fix up the home (unless they're looking for a fixer upper). The best way to see if the home is in bad condition is to make an offer and then inspect the home. If the home inspector sees major problems with the home's systems and appliances, and the seller refuses to budge on the price, and won't fix the systems or appliances, decide if you're OK with fixing up the place yourself, or if you should find a better home. Remember, even if the home comes with a home warranty, that won't cover everything. Read through the contract to see the home warranty coverage. A home warranty is like home repair insurance (or an appliance warranty). It may not cover known conditions.
If you're worried about why a home is on the market still, ask your real estate agent. They will be able to tell you what's going on with the home. Most MLS systems will show if a property was pending (an offer was made on the home) and why the buyers backed out of the sell.
For more information on home warranties, go to www.landmarkhw.com.