Pricing, Pricing, PRICING

About 6 months ago, I was reading a lot of articles that said something to the effect of: as the market slows down it will become very important to price properties very carefully. Pricing it too high will make it sit forever and then the seller will likely have to lower the price below where he could have sold it in the first place had it been priced correctly. I said this myself and the market proved it to be correct.

More recently, I've heard/read similar rhetoric with a slight modification. Now the line goes: pricing and marketing are extremely important in order to ensure that your property sells.
I still agree, however what I have been seeing from many properties represented by beautiful agents driving fancy cars, is that they have subconsciously left out the first part of the admonishment above and are simply relying on their looks, staging and some cookies in the oven to make people buy.

We'll see if this really plays out in the market, but my guess is that people who hire these agents and are not careful about how they price their properties will pay for it.

More Fuel For the Fire

As most real estate agents do, I look at listings every day. I'm always eyeing potential deals for my clients. In doing so, I've noticed recently that there are many that either expire (i.e. the listing time limit runs out and thus the listing agent looses the right to sell the property as per the listing contract) or they are withdrawn explicitly by the seller. Either way the property goes off the market.

In times past, agents would simply resign up their client and maybe make a few improvements to the property, do some snazzy advertising or even once in a great while lower the price to some catch-all price (say $599K) and they masses would converge and some brave sole would step up to the plate and buy the darned property. Then everyone would say: "What an idot. That property isn't worth all that money"

Ahh, sellers don't have it so good. OR DO THEY? Because, I'm the kind of a guy that wants to know why and how things work (even markets, I just can't get that engineer midset out of my head), I ventured to call some the the loosing agents. "What's up with that property?" I ask. "When's it comming back on the market?". And the new answer? nope, its not: "next week at a lower price", its more like this: "The owner rented it out and is not going to sell [sigh]". So for all of those people who are waiting for the onslaught of bank forclosures on the brave soles I mentioned above who held their noses and bought the properties that the masses thought were overpriced, well keep waiting.

You see this is more evidence that rents are going up. Many of those who have bought in these headdy days gone by now, are doing just fine. As interest rates are easing back down, I think that a good deal of those people on the edge can refinance and raise their rents and keep it in the black for the next 10 years.

I guess the lesson to be learned, is keep a cool head about you. Don't panic, if your gonna sell, sell for a good reason. Otherwise, keep growing that portfolio of properties. Prices have certainly cooled off in the last year, and as rents continue to rise, and interest rates increases settle down a bit, I see some good opportunities for those with the mind to take advantage.

One more 2 cent opinion from Mike

Newly Condo-ed duplex in bernal for sale

Here's the inside info report right now in bernal.

there is a 2unit condo between mission and holly park that is going on the market in the next week or so. Its a sweet building edwardian style with amazing hardwood floors, a nice back yard. huge 2 car side by side garage, 2br 1bath in each unit.

There's also a TIC on cortland which I don't think is yet on MLS yet.
That is a 3Br unit with outdoor space. Its rehab is just being finished now.

If you are interested you might give me a call or send me email:
mike Sundius 415 608-0121