Price drops stimulate sales.
The Breckenridge Golf Course home in this photo had a $400,000 price drop this week. Yes, nearly a half million dollars. Got your attention? Let me take a wild stab in the dark; the answer is “yes.”
The original price was $3,399,000, which was a very fair price that generated several showings and plenty of buyer interest. Today the price is $2,999,000. Over the past few months, a total of six different buyers have expressed a strong interest in this house. Due to the price drop, they are now really interested.
Price drops of over 10%, like this one, stimulate sales and that, I can assure you, is a good thing for both buyers and sellers. All of us in the real estate industry would be pleased to see the number of transactions increase. Here are the three main reasons large price drops (over 10%) make an impact.
Generates attention. Buyers take note of large price drops. Whether the price drop is $400,000 down to $3,000,000 or $40,000 down to $300,000 both are big and just as important. The only difference is that one has an extra zero. Buyers – be involved. Make sure you are getting automatic emails every time a property you might like comes on the market or when a price is dropped. Contact me if you want to learn about how this service works. The automatic emails are important because we often see properties sell quickly after a large price drop.
Creates urgency. Large price drops often mean the property is now priced a little bit below the current market value. And that makes buyers jump. I have seen it happen many times. The buyer saw the property three months ago and loves it, but just could not justify the price. Then they get an email with the price drop. Now they fear if they wait too long, somebody else will snap it up. So they write a contract. Pretty straight- forward logic.
Gets Realtors excited. Full time Realtors, the ones to work with, are on the ball. They track the market, watching and waiting for changes that will impact their clients. And when they see a large price drop which makes a property attractive, they get moving quickly to sell the property. This is one of the amazing benefits of the Summit Association of Realtors multiple listing service. Sellers have several hundred Realtors working to get their property sold. And in the current market what are the eagle-eye, top notch Realtors looking for? Great value.
Market Insight for the week:
Buyers: Work as a team with your Realtor and stay on top of price changes. Sellers who make large price drops are often telling you they want to sell quickly, which means you might buy at a very, very good price.
Sellers: Small price drops overall rarely generate additional buyer interest. You are better to wait and make one large drop rather than a half-dozen little ones.
Daniel has earned the national Quality Service Certified® Platinum award, recognition of 100% client satisfaction. He is a Broker Associate at Resort Brokers Real Estate, Breckenridge. Call him at (970) 393-3300. To receive his concise weekly ‘pulse of the market,’ drop him a line Daniel@YourMountainBroker.com.