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Why You Cannot Sell Your House in This Hot Sacramento Market
You cannot sell your house in our hot Sacramento real estate market for any number of reasons. Let’s look at a few. First, it is not always price. You might own a unique home, unlike anything else on the market. Unique homes appeal to a unique buyer. They do not appeal to your normal run-of-the-mill buyers. Sometimes we get lucky and a unique buyer pops up right away. Sometimes it can take 6 months to a year to find that needle-in-a-haystack buyer.
Another reason you cannot sell your house in our seller’s market might be due to improvements. Your home might be over improved for the neighborhood or under improved. If it is over improved, a price adjustment or outright patience will move that listing. Buyers want fixed-up, turnkey properties. If it is under improved, it might not sell at all at the price a seller wants.
Unless, of course, if it is a major fixer. Major fixers always have plenty of buyers fighting for the right to turn their lives upside down by trying to become a flipper. I’ve noticed hard-money lenders sourcing get-rich-quick seminars, trying to educate would-be flippers on how to do an incredibly difficult job fairly poorly. These same lenders also pull in investors to fund hard-money loans to their flipper audience. What a racket.
Sometimes sellers try to be helpful; they want to share tips they just pulled out of thin air to their Sacramento Realtor. Agents need to show compassion. Sellers don’t see where they might be disrespectful. Once a seller asked if I could put up 3×5 cards at a laundromat. Because they are not in the business, they do not realize all effective marketing is online. It’s not in that magazine at the beauty salon. It’s on the internet.
Another seller asked why aren’t visitors to Zillow clicking on his listing. What was wrong? When your marketing verbiage is excellent and the photos superb, it is probably because buyers aren’t looking for homes on Zillow. Or, there is not a big market for your house. Maybe too much competition in a particular neighborhood. Not to mention, interest rates are increasing, thereby reducing buyers’ purchasing power.
One of the things I do when I take a listing is look at how long it took to sell that particular home the last few times. Doesn’t matter when. I’ve got 4 decades in the real estate business, and I remember all of our markets. If I see a home sold near its original price in a super hot market with really long days on market, it’s a problem property. Odds are it may sell over a similar time frame again.
But do not ever be afraid to talk to your Sacramento Realtor about why you cannot sell your house. If you have a competent listing agent, I can promise you this, it is not your agent. That is not the reason. Also, anything will sell if it is priced right.
Please be aware that I predict we are moving away from a seller’s market in Sacramento. Time-tested strategies that have worked for the past 6 years are no longer applicable to today’s real estate market. Is your agent aware of the shift? Buyers are saying enough is enough. Besides, markets change all the time. Get ready, Sacramento! Change is on the horizon. I can feel it.
When Is It Time to Reduce the Price of Your Sacramento Home?
If you ask some listing agents when is it time to reduce the price of a listing, they will say never. Agents are famous for repeating a home should be priced right to start with. But sometimes it is not possible to price the home correctly. For a large variety of reasons. It could be seller expectations, condition, location, upgrades or lack thereof, or an unusual way a buyer reacts over a small undetected defect. Or, market shifts. Or a fluke comp happened and sold only due to luck of the draw.
I could keep going with what I’ve observed over the past 40-some years in real estate.
Obviously, if we’re selling a suburban tract home — any Mediterranean stucco style built within the last 20 years — it’s fairly easy to price. We can find exact model matches or close enough for government work, heh, heh. But not every home is easy. And some homes take 6 months to sell regardless of the price.
Further, unlike many agents, I rarely refuse to market a potentially overpriced listing. I seriously try to maximize seller profit potential. Sometimes comparable sales will support a higher price as well yet we can’t always accurately judge buyer reactions. However, if an agent has done everything humanely possible to attract an offer and no offers are the result, then it is time to reduce the price.
Below is my estimated timeline for price reductions on average to sell homes in Sacramento. Again, though, it’s not cast in stone. It is all dependent on the area and how long it takes on average to sell the homes there. Especially since all real estate is hyper local.
Within 21 days, if there are no offers, it is time to reduce the price or at least begin a conversation about it.
Definitely again at the 30-day mark. time to reanalyze market competition, especially if the seller did not reduce the price at Day 21.
Every 30 days thereafter.
Another strategy is to decide whether you should reduce the price or reset the days on market, coupled with a price reduction. If we reset the days on market, even though cummulative appears, a price reduction is not always evident. Sometimes you want buyers to notice the price reduction and sometimes you want buyers to instead get excited over a brand new listing. Or both.
How Many Sacramento Homes Sell at an Open House?
If you’re wondering how many homes sell at an open house, you’ve come to the right place. The funny thing is if you talk to sellers, they think an open house is the #1 best marketing strategy any agent could employ. They do not realize that nationally, depending on which research you read, homes sell at an open house between 2% and 9%. Those are really low percentages. However, when used with a comprehensive marketing plan, open houses are part of the equation. They just are not the #1 way to sell a house.
Out of 100 ways to sell a house, open houses are the #91 to #98 way to sell a house.
So, why do people believe an open house is such an excellent marketing strategy? I blame it on HGTV. The truth is most open houses work like the following. An agent loads up her car with real estate signs. Then, on a Sunday afternoon, she sets them on a few street corners to direct traffic to her open house. She waits for strangers to come by. People who have no intention of buying a home. A bunch of neighbors. Kids out riding bikes. Because she is hoping a real buyer will pop in, not have a real estate agent, and she can become that buyer’s agent.
Somewhere along the way, the open house agent is also hopeful a buyer might decide to buy a home because she drove by an open house on her way to the grocery store. It does happen on occasion. A buyer might have zero intention of buying until she walks through the home and suddenly develops an enormous crush. A crush that can only be satisfied by writing an offer.
A home located in a desirable neighborhood of high demand homes is an excellent candidate for an open house. Like homes in Land Park or East Sacramento. Not every home is a good candidate and might not draw any traffic whatsoever. For me, open houses are a supplemental tool. The fact is I primarily hold open houses because my sellers expect it. They can see I’m doing something. They don’t always notice my other marketing efforts.
It’s amazing to me that due to the low odds of success, because not very many homes sell at an open house, sellers still put such a premium on this particular type of marketing. We as agents don’t tend to argue, we just go with the flow. Because our competition will promote open houses to the seller like the best thing since sliced bread.
Sometimes a seller will suggest open house ideas to me like this is brand new information that I know nothing about. They are trying to be helpful. I realize that. I don’t take it personally.
You know the best way to sell a home is not to hope for a stranger to drive by and suddenly feel an incredible urge to buy. The best way to sell a Sacramento home is to beef up internet marketing. That’s where the buyers are. Sacramento listing agents have got to market where real buyers are actively searching. Buyers are online. Few come from magazines, newspapers, laundromats, grocery carts.
Must a Sacramento Listing Agent Like a Seller to List the Home?
Good question: must a listing agent like a seller to list the home? In my early stages in real estate, back in the 1970s, I used to believe a strictly professional relationship was the only way to conduct business. Over the years, I’ve come to believe that an agent doesn’t necessarily need to “like” or be best friends with a seller, but a Sacramento listing agent does need to feel good about the relationship for it to be a fiduciary.
Hardly anybody know what fiduciary really means, much less some sellers. But to have a fiduciary, which, btw, is required between a listing agent and seller, there needs to be a minimum of trust and respect. Because a listing agent is required to put the needs of her seller above her own. Seriously. You think I’m making this up but I am not. It’s right there in real estate law and principles.
Whenever I see fiduciary in jeopardy, well, it’s a red flag. For example, when I upload listing paperwork to DocuSign, I tell my sellers to go ahead and sign the profile sheet because it’s just a document we use to input data into MLS. Sometimes they might spot a mistake, which is easy since I use a template. Everything is pre-filled to match most listings. I manually change the data, customize it. If my phone rings, I might get distracted and not pick up at the line I left. So maybe a radio button for vinyl floor did not get checked.
Who better to notice than a seller with a vested interest? I ask my clients to email me changes with a promise to correct before I send the document to the office. I am such a stickler for details and having everything perfect, pretty anal about it. I verify each listing 3 times prior to publication. However, if a seller insists that I redo the paperwork, that says they do not trust me. If they don’t trust, we don’t have fiduciary. If we don’t have fiduciary, I have no business dealing with them.
It becomes a red flag. You can’t ignore red flags. It’s silent sabotage. Rarely is it a fluke.
This is a fact because trying to work with clients who have no respect nor trust for their agent is fairly defeatist. An agent might feel inclined not to go that extra mile. What is that extra mile? It generally involves maximizing seller profit. I can tell you that is a terrible way to feel. To feel like you do not want to do your best. I always want to go above and beyond for my sellers. Every blue moon or so, though, I find myself with a seller who doesn’t inspire me to stretch myself. Uh-oh. Trouble.
There is little satisfaction in doing just an OK job. I expect great performances from myself and take pride on delivery.
But you can tell when a person doesn’t like you. In my recent experience, I felt that sour attitude after I informed the seller his home smelled like cigarette smoke. At that point, I thought I could handle it because although I might not always like a seller to list the home, I can usually find some redeeming quality in a person. So I focus on that. I was also very careful to explain it from a buyer’s point of view. But the seller hated me for it. And it didn’t get any better as time went on.
When I sent the seller a PDF file of how the listing would look when it publishes, the seller refused to review the information for accuracy. Who does that? I’ve never had a seller refuse to cooperate. Well, that would be a seller who really does not trust nor respect his agent. And an agent who tries to like a seller to list the home would find herself feeling the exact opposite.
Fortunately, this doesn’t happen very often to me. Maybe once in every couple of years. Honestly, I thought they had taken care of the odor in the home, but when I realized they had not, and they still wanted top dollar, topped with a big dollop of non-respect, well, only a fool moves forward. My only regret is I wish I had bailed earlier and not kept trying. No commission is worth aggravation.
The moral of this story is be good to yourself. It swings both ways. If you don’t like your agent, and the respect and trust is not there, find another agent. So, yes, the answer is a listing agent does need to like a seller to list a home. If the seller deliberately changes that balance, it’s a no-go.
I want my clients to feel confident that when we cross the finish line, I have done everything in my power to enhance their financial situation and protect their interests. If an agent does not like a seller to list a home, it won’t happen that way. It’s not just me, it’s true about any agent. Except maybe the hucksters.
Can a Seller Withdraw a Counter Offer Before its Deadline?
The following story of can a seller withdraw a counter offer before its deadline happened recently in Sacramento. It goes like this. Seller put a home in Elk Grove on the market just before Thanksgiving. On December 31, the seller takes the home off the market and cancels the listing. On January 1, the home comes back on the market as a new listing at a new price. This is a way to reset the days on market and get a new MLS number. We do this to revitalize a listing and generate more excitement.
I should note this is not my listing. The story involves the buyer for this home in Elk Grove and how can a seller withdraw a counter offer. This home was listed by another agent. The price was apparently too high because it did not sell. Sometime in February, the agent put the home into “temporary off market” status or TOM, as agents refer to it. Sellers are supposed to give approval for a TOM status but not every agent asks.
In March, the listing came back on the market and then a few days later expired, and then extended. Toward the end of April, the home’s price dropped again substantially, where it sat for another month. Finally, buyers came along, represented by an agent, and made an offer. The sellers countered that offer. The buyers signed the seller’s counter offer.
This is when we had a seller withdraw a counter offer. The important thing to remember in this unfortunate chain of events is the timing. Before the agent sent the counter offer to the listing agent, the listing agent texted that the sellers had rescinded the counter offer. A few moments later, the agent sent another text to say the sellers no longer want to sell. The listing has been withdrawn from MLS.
The agent asked how can a seller withdraw a counter offer when my buyer has signed it? See, the deal is if the buyer’s agent had returned the counter offer prior to receipt of the text rescinding it, the seller would have been in contract. But for whatever reason, the accepted counter offer was not delivered to the buyer’s agent before the listing agent withdrew the counter.
I see this story play out time and time again. Often what happens is even worse than this story, though. Often what happens is another offer arrives while we are waiting for the buyer’s agent to send back the counter. In those instances, we immediately pull that counter offer before the deadline. Buyers who don’t act fast enough lose.
Don’t make the mistake of thinking that just because a counter offer is in front of you that you hold the cards. The clock is ticking, and you don’t.
Photo of Vika Gerassimenko at Yosemite
