“Sticky” Asking Prices Slowing Existing Home Sales
I read something interesting over the weekend in a local newspaper. It is a story about how sellers are refusing, in some cases, to lower the asking prices on their homes. This is a development that is contributing to the slowdown in home sales in some real estate markets. Andrea Mitchell offers this insight into what is happening in Salt Lake City, Utah:
Ryan Kirkham, president of the Salt Lake Board of Realtors, said some sellers will contact a Realtor and say, “I need to sell my home, what is the market value?”
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Then there are the folks who say, “I need to sell my home, and here’s what I need to get for it.”
The latter, he says, often end up with homes that wither on the market.
“You have to realize a home is worth only what the market will bear,” he said. “Some people understand that, and they get their homes sold, and some don’t.”
This was actually one of the issues my husband and I considered as we bought our home in a new subdivision. We are well aware that in order for us to make money on our home when we sell it, the subdivision needs to be full. I have a feeling that this issue is something being faced by those in other real estate markets — not just here in Utah.
These “sticky” asking prices are probably among the main reasons that existing home sales continue to languish. Homeowners who bought their homes before the real estate bubble burst and home values dropped are stuck with this idea that they “have” to get a certain amount for their houses. Unfortunately, it’s a buyer’s market and sellers may have to re-asses the feasibility of their asking prices. Even if it means accepting less than they’d like.
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April 7th, 2009 at 5:59 pm
[…] just read with great interest what my friend Miranda Marquit wrote about “sticky” asking prices where sellers are reticent about pricing their homes at the current market value. These […]