What is the right price?

This post was inspired by the recent brokers' tour in Clinton and the
current real estate market in general.

The brokers' tour is when local agents get together and view the most recent
properties on the market, usually once a month. We can help the buyers  find the right home and help each other by exchanging our professional opinions on the listing price.

I want to start by saying that houses are still selling, but it has been more difficult to price the homes for a few reasons.

First,  you do not want to overprice the house as then it sits on the market and after a few months it works against the seller. You do not want to underprice it either, as the seller does get less plus it drives the prices of similar  properties down, which does not help the market or neighborhood.

However, many reports indicate that we are still in a declining market  as much as 0.5 % a month. This makes it very difficult to price the property.

On one hand there are homeowners who have had their property on the market for nearly  a  year. Some people go to another extreme, not many though, they underprice their good home in a good neighborhood, so it is gone in a few days. It has to be some kind of  middle, but it is becoming more elusive. Of course foreclosures and short sales drive the prices down as well.

It is particularly hard to sell a big home in Clinton, there are many houses to choose from and the pool of pre-approved buyers  is  smaller. Also it is a fact people who can afford more expensive home - over 400k - are looking to buy in neighboring towns.

From my observation, last summer when I listed 3 bed/1 bath house in Clinton in a quiet neighborhood, a similar house was listed at $199,000 and it was a short sale. The price for a 3 bedroom home over 1,000 sq.ft under 200k, was unheard of, but again it was a short sale and usually you can get it a better deal.

But since then there have been a few 3 bedrooms homes listed &  sold under $199,000 and some of them were regular sales.

Especially it is hard to move big houses over 400k (not near the water). The big houses are not in demand though the prices have been dropping.

On a lighter note since the beginning of the year, 40 homes went under contract in Clinton (statistic includes sold, deposit, show status). The properties under 400k, moved on average within 3 months. The chart reflects that.

Also in the chart it shows that the houses in a lower price range - under $179,999 - took longer to sell, it is because it was either a short sale or the deal fell apart or property was waiting for an auction.