Bet you’re wondering why I’m choosing to write a post about the listing that didn’t sell rather than those listings that did sell this year.
To answer that I want to tell you a little story. A long time ago when Boris Becker 
was at the peak of his career and had just lost a match (a rare occurrence at the time), he made the astute comment that he expected to learn from that experience and that you don’t learn anything from winning, you learn from losing. I should mention that as great as he played tennis, I didn’t have him down as a philosopher, which is probably the reason those words stuck with me. He was such an unlikely source for this pearl of wisdom! I’m sure he didn’t come up with the concept, but he was the one who conveyed it in a way that made perfect sense to me. Through the game of tennis.
Anyway, based on that principle, when things go wrong, I tend to look at them as learning experiences. Hence my post about the listing that didn’t sell.
To put this into some kind of context. Listing and selling homes in Iowa City and Coralville made up 25% of my business this year. (After 5 years in the business helping mostly buyers I had more sellers ask me to list their homes this year). This was the only home that didn’t sell. Why?
First of all, listing and selling homes is not rocket science. For a house to sell it comes down to looking at three basic things. Price. Condition. Location. (Marketing is something you need later, but unless you have addressed these three things up front the best marketing job in the world won’t do you much good).
So where did we go wrong? Surprise, surprise, it was on the price. Setting the price shouldn’t be rocket science either, but in the current market it does have its challenges. The tried and true method is to look at similar style homes that sold in the same neighborhood or in a neighborhood nearby in the past few months. That’s exactly what I did with my listing. We priced it slightly below what the last one sold for. That should work, right? Nope, not in a declining market. That’s what I failed to factor in at the time. Of course I don’t have a crystal ball either. It was spring and condo selling season. The strategy seemed viable. It wasn’t.
What I learned from this experience is that this is not the market where you get to “play around” with the price. 
What ended up happening in this case is that for the next six months we “chased the market.” In a declining market the price reductions were always too little too late. I learned this lesson early in the year and did a better job factoring in wild cards after that and explaining to sellers that they needed to respond quickly to market conditions and price their homes accordingly.
So here’s my advice for sellers in the Iowa City and Coralville area who have had a similar experience this year: Keep in mind that saying that ‘real estate is local’ and take it very literally. The Iowa City real estate market has been picking up in the last few months. That may or may not be true for your neighborhood. Pricing your home has absolutely nothing to do with what you paid for it or how much money you’ve put into it since you moved in. It has everything to do with what is going on in your neighborhood.
If you had a home on the market in the Iowa City area that didn’t sell this year and would like to talk about what we can do to change that, please give me a call at 319-400-0268.
Super post Denise. Watching a dog chase his tail might be fun, he might get lucky and catch it. Sellers too might get lucky and snag a buyer but it’s unlikely. I had a listing opportunity 2 years ago. The seller chose not to use me, didn’t like my price, even though is was supported with recent sales. Two years later, several price cuts later, they are still chasing the right price, and are now lower than my number. Had they taken my advice they would likely have sold by now and achieved their relocation.
It’s also important for sellers to understand that pricing a house is always difficult, so many variables, but if at the start the signals are loud and clear, too high, reaction must be swift and strong.
I am sure sellers in Coralville and Iowa City are similar to the rest of the country, 3 of 4 still thinking their homes are valued higher than reality. Well done on showing the issues of over pricing. Of course even if the seller does snag that buyer, the appraiser might have more to say on the subject.
You’re right, it’s a tough market for sellers Corinne. Especially the unrealistic ones. And what’s particularly tough here in Iowa City and Coralville is that folks relocate here for the UI and often don’t own their homes long before they need to sell them again. Prices in Iowa City certainly haven’t taken a hit like other parts of the country, but depending on where the house is the chance of making a profit right now is not high. And chasing the market is certainly not fun. I know – been there, done that…