Question of the week:
Thoughts on Realtor Suggesting We Do More Work and/or Lower Price After 10 Days On Market?
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So my house has been on the market for about 10 days. We aren’t in a rush to sell, but would obviously like to see it go. We are selling a 3-bedroom mid-century semi bungalow with a new kitchen and open concept living space with a large rec room in the basement for 625k which is typical of our area.
Prior to selling, our realtor suggested we do some work on it, so we painted the paneling in the basement (it’s very 70s) and renovated the bathroom to now have 2 full baths. While I was upset about the considerable amount of money I was putting into the home, I got why I was doing it.
The issues that still remain are that the basement back room is unfinished (laundry, storage, etc) and the basement carpet is an insane 70s brown pattern.
We’ve had it staged and are selling it for essentially the price we paid plus the Reno’s (so likely making 0 profit on it), which is fine because we are moving for work. We’ve had 20 showings so far without any offers (2 were close but ultimately had offers accepted on another home). Generally the comments are positive but people don’t like that they have to change the carpet in the basement. That is the only negative feedback we’ve received so far since the rest of the home is updated and extremely well maintained.
My realtor is now telling us to do the work above, plus renovation on the upstairs bathroom – which total would come around to 7k or he wants to reduce the price by 5%
Obviously I know the current market is a buyers market and people are wanting a house where they have zero things to do in it, but, is my realtor just being impatient and hustling us through so he doesn’t have to have it listed anymore?
Should I do the work and am I just being a baby about it?
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Nick's Response
Thanks for details in your question.
I think that a price adjustment now might be jumping the gun, unless there’s clear evidence that your place is overpriced.
Here’s why:
If the rest of the home is turn-key (or at least as turn-key as the homes it’s competing with) then the basement carpet is a much smaller factor. Plenty of homebuyers are willing to overlook a tacky basement and deal with it in the future.
August is not typically a fast month in Ottawa, and that (anecdotally) has been true this year as well. You’ve listed deep in the summer lull, and though that shouldn’t affect your eventual sale price so much, it will mean that your average days on market will be higher now than if you were listed in April or May, for example.
20 showings is great for the amount of time that you’ve been on market, averaging two a day. Is your Realtor collecting feedback from every showing? Unless the showing regularly mentions the carpet or price as an impediment, then you’re getting a good volume of looks at your home and one of them ought to bite with an offer soon. Most of the time, 3-5 showings a week is healthy enough in our market to tell you that the home is priced appropriately, or close to it.
It is not a Buyer’s Market in Ottawa. The absorbtion rate (basically, the time it would take to sell everything currently on the market if you turned off the tap of new listings today) last month was 2.8 months
. Although it does indeed feel “slow” compared to the Covid market which is fresh in our collective memory, that would be considered a weak Sellers’ market in any other time in the MLS. It’s important to price appropriately and present well in order to stand out, but you still have leverage as a Seller.
To address some comments that you have a “lazy Realtor,” I would counter that they have positioned your home and marketed it attractively enough to plenty of showings, so they’re being effective. It also sounds like you’ve been the runner-up house for a couple of Buyers. To suggest a 5% price adjustment at this junction may be too soon, but it may simply be the M.O. of this Realtor to suggest aggressive cuts to keep the listing fresh. As the owner you’re always in control and have the final word as to whether you actually make the price adjustments. Have another look at three weeks or a month, consider the competition and what’s been selling, if not yours, and then every couple of weeks thereafter.
Good luck on the listing! A semi-detached bungalow should attract some attention in our market as they’re relatively rare.
When to make a listing adjustment
1
When the feedback is (consistently) negative – Some Realtors choose to be negative about the homes they show, which you should take with a grain of salt. If everyone who’s viewing your home says it’s $30,000 overpriced, or that it has a bad smell, it might be time to take note.
2
When your competition is all selling (and you’re not) – This is less of a factor if you have a “unique” home with few true comparables, but if you live in a property development where similar (or superior) homes are selling faster and at the same (or lower) price than yours, then it’s time to ask for an unbiased look at how you can reposition your listing.
3
When time is of the essence – Moving is a pain, and if you have a deadline for a work relocation or closing on your new place, doubly so. Sometimes an adjustment is what it takes to get the home (and you) moving on with your life.
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