We want to talk to you sellers out there who have not been successful in selling, as you had anticipated you would be. So you’ve been on the market, you’ve hopefully used a professional to make sure that everyone that should know about the property is aware of it. And you’re not getting the offers streaming in like you had hoped or planned.
Bob Nelson, Eugene real estate investment broker
Marcia Edwards, Eugene residential real estate broker
Bob Nelson: It happens periodically, particularly where there’s low inventory. So the anticipation of the seller, I should be able to take advantage of this situation and sell higher than anybody’s ever anticipated. Let’s come on at a particular price. Now, as you do that, you hit the market with a property, and there are a pent up number of buyers that are going to look at this thing because it’s brand new meat to the market, so to speak. It’s brand new inventory, that they’ve not seen before, and at that particular point, everybody’s going to look at it seriously. If they discover that the price is too high they’re going to reject it seriously.
Marcia Edwards: You’ve heard the saying there’s no second chance to make a first impression. This is definitely the case in real estate. You do have the strongest, most educated, most prepared buyers pent up waiting for the newest opportunity. So picture the scene, all right, let’s say we’ve done it, we actually thought we were being reasonable in price, and it still didn’t sell. What we’ve got then is an education from the marketplace to the sell. The seller has to go back and say what am I willing to do to make this sale, or does it still make sense to sell at this time?
Bob Nelson: And that could be the decision. They’ve decided if I can’t hit this price, it makes no sense for me to make a move. They’ve discovered that their next move is going to cost them a certain amount of money, and in order to fund that they need to sell this particular property. You need to identify that.
Marcia Edwards: That’s right. Other sellers may have left a margin intentionally, or unintentionally thinking they would negotiate it off. Residential in this marketplace … You’ll have to tell me about investment, Bob. In residential in the marketplace there’s not such a margin. Buyers are expecting to pay close to retail, and they don’t look 10%, 20% above what they’re willing, or able to pay.
Bob Nelson: There’s things that you can gauge as to the fairness of a price, of an income producing property. There’s a cap rate, now if the cap rate is too low, relative to all of the things on the market, hey guess what? People are going to either make a low offer that would make the cap rate at its proper level, or simply reject it completely.
Marcia Edwards: So we’ve got a look at strategies to get this rebooted and sell the property. We’ll talk more on that next program.
Join Eugene, Oregon, real estate experts: Bob Nelson, Real Estate Investment Broker with Pacwest Real Estate Investments, and Marcia Edwards, Residential Real Estate Broker with Windermere Real Estate, daily at 5:30 on KPNW for the “Real Estate Today” radio show.