Wow, 2009 is certainly going out with a bang. Lots and lots of contract action in the Denver/Boulder region right now in what is traditionally a very SLOW time of year.
It’s possibly a reaction to the 8k tax credit from Uncle Sam, but I don’t think so. It seems like buyers are snatching up bargain properties once they hit the magical correct list price.
It just proves that when it comes to pricing, it’s better to SET the market than to CHASE the market. Yes, it’s honestly better to be a just slightly low and to get a quick sale and/or multiple offers than it is to be over priced and to linger on the market.
The reasoning behind this is many-fold. But if you simply factor in your carrying costs, you’ll see that holding on to your property for 6 months while it lingers on the market has costs associated with it. It can easily cost a seller thousands of dollars a month, for 6 or more months, to sit on a slightly over priced property. We’re talking 10′s of thousands of dollars. Why not just drop the price to begin with and generate multiple offers over a very brief time frame (with low or no carrying costs), the result of which could be a bidding war (higher sales than list price) as well as a quick closing?
Not to mention that properties which sit on the market tend to attract low-ball offers as buyers seem to sense blood in the water.
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