Why do homes fail to sell? Some homes in a hot real estate market or a “seller’s market” fails to sell for several reasons. Learn all about them here.
Nationwide, Realtors report many homes unable to sell no matter how hot the sellers’ market. On July 28, 2021, The Ascent (a Motley Fool company) reported that: “89% of Properties Sell in a Month”. Their report focused on the residential housing market.
Using words like: “On Fire”, “Scorching”, and “Red Hot” residential real estate prices are at record highs due to a low housing inventory and attractive 30-year fixed mortgage rates. The Ascent key findings showed:
Home prices grew 21% from June 2020 to June 2021;
89% of all residential properties sold under a month in June 2021;
An increase of 36% from June 2019;
The average time for homes on the market was 17 days, 10 days fewer than June 2019;
Sellers averaged four offers, double from 2019; and
55% of offers were made above the listing price in June.
Why Do Homes Fail To Sell?
So, given this “red hot” housing market nationwide, sellers unable to sell their homes ask: “Why isn’t my home selling?”.
The answer during this current “hot market” boils down to three reasons:
Price – Overpriced homes do not sell, even in a hot market;
Condition – Homes in poor condition never sell as well as a “move-in” home; and
Marketing – Bad marketing leads to poor sales for every product.
Let’s explore these three reasons.
Your Home Listing Price
First of all, you must look at your home like a product. You need to apply product sales business principles.
No matter what product, if it is overpriced it won’t sell. Do you buy the first car you see at a dealership? Hopefully not because you should compare prices on the same model and age of the car you seek. The same principle applies to buying a home.
In a hot real estate market homes listed at a fair price sell fast and sometimes for more. That’s because buyers do their homework by comparing similar homes online and with personal previews. Buyers seek value for their money.
Fairly priced homes attract more buyers who end up competing against each other. In other words, a house attracting many buyers creates the perfect situation to start a bidding war. Thus, you end up selling your home at a higher price than your listing price.
How do you price your home? You need to look at the comparisons (comps) in your immediate neighborhood. The Comparative Market Analysis (CMA) performed by an experienced Realtor compares your home with similar nearby homes recently sold.
That’s the best way to know what local buyers pay for a home like yours. Until the RealScout program refined CMAs which you will learn about below.
Condition of Your Home
The condition of your home either is a deal maker or a deal-breaker. Homes in poor condition hamper your ability to sell.
Invest the time and energy to make your home presented in the best light to attract buyers. Realtors call this “curb appeal” on the outside and “home staging” for the inside.
Learn more about curb appeal in our broker’s blog post: “How to Create Positive Home Buyers First Impressions”.
Read our informative post explaining: “Tips for Staging Your San Diego Home When Selling”.
After seeing your home’s Multiple Listing Service (MLS) on the internet, a buyer wants to:
Look at the photos;
To drive by to view your home from the street to see if it has “curb appeal”; and
Finally, passing these steps induces the buyer to want to see the inside.
Once inside, the buyer sees the condition of every room, floor, ceilings, windows, and layout. The buyer next looks at the sides and backyard. You must make sure everything looks clean and livable.
The Art of Marketing Your Home
Your home is a product for sale. Like any product, it needs good marketing to attract buyers at the highest price. Poor marketing ends up not being sold because buyers never discovered it. Good advertising and promotions bring products to the attention of buyers.
Proper marketing creates a demand for your home. Without marketing, your property may sit unnoticed by buyers for a long time.
Products need a marketing plan. Not just any marketing plan but one specifically designed to sell your unique home. Avoid real estate agents offering a “one size fits all” marketing strategy that relies on luck instead of a careful marketing plan.
Simply putting your home on the local MLS hoping it gets noticed won’t work.
When you seek your next home will you just drive around neighborhoods looking at “for sale” signs? Of course not, because it’s a waste of time.
After a long time sitting on the market your home becomes a dreaded “stagnant” listing. Then, your listing agent will suggest lowering your asking price. Lack of good marketing ends up losing you money.
A Realtor’s primary objective is to create a demand for your home. Creating a lot of demand for homes results in generating more than an offer at your listed price. Great demand results in getting the highest price for your home.
That’s why our Realtors at SoCal Lifestyle Realty use a unique real estate marketing tool called the RealScout. Learn more about how we list and sell homes using RealScout in our post: “Strategy and Tactics for Selling Your Home”.
Why Do Homes Fail To Sell? – Conclusion
The answer to a question about “Why do homes fail to sell?” is simple. These three reasons are the main causes for lower prices:
Listing price too high;
The poor condition of the home; and
Bad or no marketing.
How do you improve these three problems?
Follow these suggestions to come up with the best listing price and sell your home fast:
Hire a competent Realtor familiar with your neighborhood to perform a good CMA;
Let your Realtor perform a RealScout Buyers’ Preferences analysis of your home;
Give your Realtor a full tour to see what upgrades can increase your home value; and
Rely on your Realtor who uses RealScout marketing tools to get your listing to the right buyers looking for our home’s features instantly.
Do Your Local Realtors Use RealScout?
SoCal Lifestyle Realty is proud of our RealScout program in the greater San Diego area. It helps our Realtors to suggest the best listing price and instantly find suitable buyers based on your home’s features.
Contact us so one of our experienced Realtors can perform a CMA and use RealScout to help you list, market, and sell your home at the highest price in San Diego County.