Why Selling a Home Takes Patience

Every weekday morning, the bell rings in places like New York, London, Frankfurt, and Tokyo and stocks are traded based on everything from economic data, to perception of future gains, to raw emotions. Commodities and stocks are traded in a well-regulated market where values can be easily tracked minute by minute and year over year in a global market. 

Unlike stocks, in real estate this market is hyper localized, passively regulated, and often based more in personal opinions than data. Rather than a fixed trading window where everyone has all possible data, real estate brokers are operating autonomously and asynchronously to form a market, often with incomplete information. 

When you list your house, you are bringing that asset to a potential market, where buyers of all thinking and budgets will determine whether they are interested and where they would price your home. All those concepts from freshman economics you might recall, like demand curves and substitution are happening live. As an agent and as a seller, we have to listen to unspoken messages from the market. No offers? Maybe we are priced too high or don’t have enough exposure to potential buyers. Multiple offers the first day? A likely sign that supply and demand are not well balanced in our market and that there are few acceptable substitutions (other houses) available for our buyers. 

As a seller, it can be invigorating to see offers begin to come in, especially if they are above asking price. Still, offers need to be examined for all their merits, not price alone. For example, key factors include:

— Will the buyer need to sell a house in order to purchase my house?

— Will I need to help the buyer with closing costs to help sell my house?

— Are there delays or contingencies built in to the offer that enable a buyer more time to potentially walk away?

While the old saying in real estate that your first offer is often your best still holds, there is merit in allowing a market to develop. In a fast moving market with a desirable home, if your goal is to maximize your return it can be a wise move to let a house sit on the market at least a full week and through several weekends, to make sure that a sufficiently large number of potential buyers have seen the home and been able to put together their offers. There is a natural rhythm  to this, where the house will hit the market, there will be a great deal of interest, then offers will start to come in waves. If you take the first offer without allowing this market development, you might be missing out on allowing all potential offers to come in. Of course it still stands that if your house has been on the market for several weeks and the showings and offers have dried up, then the window has shifted the other direction and you’ll need to take action to reinvigorate interest. 

Have a strategy before your house hits the market. Know its worth and the steps your agent intends to take to maximize its opportunity in the market. Don’t sell until you’ve actually got the right offer in hand.