In today's market, the first thing I hear most buyers ask is "how long a house is on the market?" If they hear it has been on the market more than 6 months, interest drops or they immediately start talking about buying it for a very low price. It's human nature to be attracted to those things that others find attractive. The natural assumption is that there must be something majorly wrong with the home. But there are many reasons why a house has been on the market for a while.
A very common reason is that the home was originally listed to high. When a home is first on the market, it typically gets a large volume of "lookers" and potential buyers previewing it. It is crucial for it to not be overpriced, or those potential Buyers will pass, either because it simply is not showing up in the right price range or those people looking in that price range are finding better deals. So the house sits on the market for a few weeks then a few months. Even if the price is lowered, the initial "buyer rush" is over! The damage is done!
Another reason commonly cited is that it is difficult to show or preview the home. Possibly there are uncooperative tenants or homeowner that put too many restrictions on showing times. If the home can't be previewed with ease, there will be lots of missed opportunities to have possibly sold the house. So this home stays on the market. Also, some sellers or even their agents could be unreasonable. They do not want to sell their properties for a dime less than what they are asking. It may be a ridiculouse price, but it may also be entierly reasonable. Buyers will run from a seller unwilling to negotiate price and have a listing price at or near the market comps.
If you run into one of these homes that have been on the market for awhile, don't dismiss it immediately. Who knows, circumstances change everyday. One thing to check out is the average days on market of the neighborhood. If the average is high, talk with your agent about the possible causes. Perhaps, he/she can contact the listing agent and find out more about the property and why it has been on the market so long? If the average is lower than that particular house, just investigate the house, as you would with any property.
If you do decide to buy and the offer is accepted, make sure to have inspections conducted. Check that it is not in a restricted area, like a flood zone or endangered species area. Also, most MLS systems will show if the property ever went pending. Your agent can ask that information of the listing agent.
In the end, it is important to not become emotionally involved in the purchase of this sale. Sometimes it is easy to accept those things that you normally would not accept when you are emotionally involved. Days on market could be an indication of the property has issues, but that is not always the case. Some of the best deals are properties that are being ignored by everyone else.
If you would like to receive a Comparitive Market Analysis of your home for possible sale or a listing of homes in your area for purchase, please feel free to call me, Todd Hillman at 623-979-3002.
