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Suburban Strategy

Homeowners put their house on the market three weeks ago, pricing it at $699,000.  Their neighbors are selling too; their $625,0000 listing went live just a few days ago.

The clients (who had informed me in February that they were selling) are now pulling their house back off the market, as both homes are basically the same inside and out. They can’t afford to sell at closer to $600K than $700 K, and so they called to say that they’d bide their time and see where things went.

I didn’t want them to think I was giving out advice against their better interest just to earn a fee, but I piped up anyway, saying that they should let their listing remain active.  I explained that there might be a bidding war that brought their neighbor’s home up a bit in price, with the loser thereafter likely to pay a bit more to get the similar house next door.

Both mortgages might be processed about the same time, meaning that the lesser-priced home wouldn’t drag down the comps for their house.  However, if they waited until after their neighbor closed and then tried to re-list, next door’s lesser price would almost certainly result in buyers making lower offers and/or an appraiser under-valuing their home (relatively speaking).

I could hear the light bulb blinking on as one of the owners said, “Oooooooooh, that’s really clever. I was feeling bad, but now you’ve got my competitive juices flowing! Let’s go for it!”

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