But is it really wise to hold out for "Full Ask"?
Several years ago, when the real estate feeding frenzy was at it's peak, bidding wars were common and prices climbed every week. Sellers puffed out their chests and bragged that they got $200,000 over asking price. Interestingly, buyers also boasted that they "paid $200,000 over asking price, and I won!". In some markets brokers even adopted the strategy of deliberately listing the property well below market value in anticipation of a bidding war driving it far beyond what it was theoretically worth.
This strategy often worked. In that particular psychological climate buyer's fear of losing was so strong that they willingly overpaid just to keep their "competition" from winning. Seemingly odd behavior, but a surprisingly "human" reaction.
Times have changed. The market went through a dramatic swing when prices dropped drastically. Interestingly, you would think that stressed-out buyers nervous about committing to paying such a huge premium to own property would jump at the chance to buy at a 20-30% discount, but no -- they did not. They were scared and afraid. Logically you may ask "Would you like to buy the exact same property that was priced at 'x dollars' six months ago for only 80% of 'x' now?" but the answer was almost always "No".
Where are we today? It's neither a seller's nor a buyer's market. Most properties are priced reasonably and most trades are reasonably close to asking price, but almost invariably there's some wiggle room. You would be hard pressed to find someone today to pay full ask simply because they expect to negotiate.
As a seller you must consider this before you commit to an initial asking price. If you think your apartment is worth $1,000,000 it would be far wiser to list it at $1,050,000 or $1,100,000 and negotiate with a buyer than to list it at one million and expect full ask. The strategy may change over time, but that's the way it is now.
Summary: Markets change. You must to adapt.to them accordingly. Bucking the trend -- even if you think it makes sense -- is a recipe for failure. You can still achieve the same goals, it's just the method that requires flexibility.
Reach me at: michael.sussilleaux@gmail.com
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