The housing market isn't treating us so well here.

[MomToTwoBoys]

We listed at the end of September with the hopes of getting offers around $234,900. We had one really low offer and a few showings, but nothing concrete. As such, we reduced the price about $10k to induce more interest.

We've had one open house (with two families that showed up) and one showing in the last two weeks.

I'm starting to lose hope that our profit margin is going to be intact.

I did the math:

Current mortgage - $100k
Mastercard - $6894.93
Visa - $2900
Roof Replacement - $2436.00
Miscellaneous - $1328.17
Bathroom Renos - $2216.87
Realtor/Lawyer costs - $10,500

If we can pull off a $80k profit (not including moving costs because those are being paid for by DH's employer), we can bid on houses that are in the $240k range. That's totally doable. $240k with everything paid off would mean with an $80k down payment and no debt, we would have a $160k mortgage. It's just $40k more than we had 5 years ago. We'd like to plunk down a variable rate and right now, variable rates are at about 3.85% for 5 years. We would actually pay less if we go with a variable rate, so it's doable for our budget.

We've already lowered the price once and that was after we had lots of interest. With the winter months here, we knew we wouldn't get as much interest in the house. However, other homes in the area are selling and they're TLC places. One just sold that's detached, but 100 sq/ft less, for $198k.

So do we just bite the bullet and lower it again? We simply cannot afford the current situation we're in much longer. We've done well by not taking on more costs in terms of the home since we stopped renovating, but the gas money and the money DH is having to spend to come home and go to work every day is killing us. A 50 minute minimum drive each way every day for him + every other weekend driving back here means he's spending double on what he was spending before. That's $240 minimum in gas alone. He's getting more OT at work because they don't allow for banked time, but that OT is only going to go so far.

[porembam]

I wish you good luck in selling your house - you just need the one right person.
Mortgage rates are so low it would work so well for you on the buying a new house now -

[Vanilla]

However, other homes in the area are selling and they're TLC places. One just sold that's detached, but 100 sq/ft less, for $198k.

Sorry, the market is slow. I don't know anything about the market in your area. But from that sale you mentioned, the appraiser will use that as a comparable, that means yours w/ 100 sq ft larger, add on $120 per sq ft (give or take), the appraisal base value for yours would be $210K, may be adding another $2000 for the new roof, $212000 could be the appraisal value (also give or take). If sale price is subject on appraisal, then buyer would come back & negotiate the sales price even if they offer more originally.

I am not sure about getting the variable rate. This has been happening the last few years, people get the fix-5-years, after 5 yrs, the rate goes up, the monthly payment increase also, people couldn't afford the increase payment, couldn't refinance because housing price dropped, bank foreclose on them. Please proceed w/ caution on getting variable rate.

Maybe you can rent first (for 6 months to a year) in the new area, get to know the area better & save more before buying. Or maybe buy a smaller house first, then move up in a few years.

That's just MHO.

Good luck.

[mschrief]

I can really relate to your post. I have my condo on the market for $234k (we paid $250k). We used MLS by owners.

NOT ONE PERSON has wanted to look at it. Other units in the building are having the same problem. NO interest watsoever.

We spent about $5k putting in 30 year pergo, redid two bathrooms, painted every wall, replaced existing plastic moulding w/wood, tiled the entry and patio.

NOTHING. Nada, nobody.

So disappointed. But we have a nice place to live, but we have land we want to building on....really feel like prisoners.

[MomToTwoBoys]

Sorry, the market is slow. I don't know anything about the market in your area. But from that sale you mentioned, the appraiser will use that as a comparable, that means yours w/ 100 sq ft larger, add on $120 per sq ft (give or take), the appraisal base value for yours would be $210K, may be adding another $2000 for the new roof, $212000 could be the appraisal value (also give or take). If sale price is subject on appraisal, then buyer would come back & negotiate the sales price even if they offer more originally.

I am not sure about getting the variable rate. This has been happening the last few years, people get the fix-5-years, after 5 yrs, the rate goes up, the monthly payment increase also, people couldn't afford the increase payment, couldn't refinance because housing price dropped, bank foreclose on them. Please proceed w/ caution on getting variable rate.

Maybe you can rent first (for 6 months to a year) in the new area, get to know the area better & save more before buying. Or maybe buy a smaller house first, then move up in a few years.

That's just MHO.

Good luck.

Renting would eat into our profit to use on the down payment. Houses in Edmonton are renting at a minimum of $900 a month. We pay $670 every four weeks here (we're on an accelerated bi-weekly payment plan for the mortgage).

The main problem we're having is that even with a reduction in price, no one's coming to look at the house. We have renovated the bathrooms, replaced the roof, re-did the kitchen and repainted everything that needed it. We basically fixed up everything in the house that needed to be fixed. Our main competition in just this neighborhood alone in our price range is six properties. Four of those are owned by Calgary Housing and are detached bi-level homes (with exception to one that's a 2-story) and are priced about $10-20k lower than ours. Our best competition (one that was renovated just like ours) isn't on the MLS anymore. It didn't sell because we didn't receive an email stating that it did. It was just pulled from the MLS. We figure the people who had it listed didn't like the market conditions and removed it.

However, we can't do that. We're at a point in our life to where we need to sell this house. It's not a matter of wanting to anymore... it's essential that we sell.

In all of Calgary, there are 39 homes that are 3 bedroom, 1.5 bath and 2-story builds that are between $200 and $225k. I'm not sure if we just have stiffer competition or if people are buying detached homes before they reach ours. I just don't know how much longer I can deal with this separation thing and the fact that it's eating into our budget.

[Nishu]

What is a TLC place? Why is your home priced more than the detached homes in your area? I couldn't really tell by your post.

[frugal is fun]

your neighbors may have taken it off the market with a plan to relist as a "new listing"....sometimes gets attention, sometimes not

how is your realtor? are they doing everything possible for you as far as advertising?

can they bring in other realtors to see your house so when they get a client your house maybe one they show first.

[Vanilla]

I don't know what to say, except that I am so sorry that all the hard work & upgrades you have done to the house haven't bought on a quick sale.
Even though it's a buyer's market, but the buyers are sitting on the fence.

[MomToTwoBoys]

What is a TLC place? Why is your home priced more than the detached homes in your area? I couldn't really tell by your post.

A TLC home needs lots of renovation work. It generally needs about as much work into it that is necessary for the family to live comfortably. Generally, Calgary Housing will list their homes as TLC homes to get either investors or families into them as a way to clear their inventory. These homes could need everything from a complete gut of the kitchen to the entire inside of the house being renovated. Things like a new roof, new windows, etc are also needed.

Our home is priced more than detached homes in the neighborhood because it was assessed at $218k in January. It's been through some renovation work and based on comparables in the neighborhood, it shows better. It's also more functional and the only work it may need is a new furnace and the basement to be finished (it's partially finished with a rec room in one half of the basement).

your neighbors may have taken it off the market with a plan to relist as a "new listing"....sometimes gets attention, sometimes not

how is your realtor? are they doing everything possible for you as far as advertising?

can they bring in other realtors to see your house so when they get a client your house maybe one they show first.

Our realtor's a good guy. He recommended that we refuse the initial offer because it was insanely low and he's had an open house, but he's also told us that our home is just slightly overpriced compared to others in the neighborhood. He has also given us email update access to all of the homes in Castleridge that have either listed new, went to pending status or sold outright. These emails also list what the home was listed for and what it's sold for, how many DOM (days on market) it's been on for, the square footage and other essentials within the home to help us compare.

He's made a website for the house and has hooked it up with a texting service that allows interested parties that drive by the opportunity to text a number and get instant access to the home. That way, they don't need to wait until they get home to check out the house.

I talked to DH this afternoon and he thinks that we're both in a slow time and that the homes in the neighborhood need to sell before ours. He recommended that if I feel that the house isn't selling fast enough (he believes it isn't sell fast enough either), then I should give the realtor a call.

It's been on the market since September 29th. It'll be 8 weeks tomorrow that the house has been listed. I didn't think that the market was -that- slow. I saw three separate groups of people viewing the house across the street in the same day, which leaves me to believe that either we're overpriced or the season is just slow.

[HappyMama]

I find the pricing rule of thumb to usually hold true in most places. I have many friends that use to be brokers, realtors or mortgage brokers....sigh..now with the economy they say this still holds true. Not sure about Canada real estate but my understanding is the same in this economy. If you have on the market so many weeks and no bites or too low of offer you are too high for market in your area. I know you have did lots to the house , have a beautiful home and are disappointed . Hope it sells soon and you don't have to lower.

Here is an excerpt from a Realtor in California explaining rule of thumb:

Pricing Rule-of-Thumb

Some people have said that I should write a book, and I respond – “I have!”



But the most important one is the pricing rule-of-thumb.

A seller called yesterday and wanted to know what was wrong with her listing agents. She’s only had a couple of lookers over the last several months, and thought the agents should be doing something more/better/different.

I asked her about price, and she said that they had put in more than $200,000+ in improvements, but were only listed for $100,000 ABOVE what they paid a couple of years ago.

If you bought your house between 2004 and now, and you want to resell it, expect that buyers will only want to pay LESS than you paid, not more. With one click they’ll see your sales price and date, and not bother to hear about the deluxe sun room! So either sell for less, or don’t sell.

How much less? Here’s the formula:

1. If buyers are making offers, you price is about right – w/i 5% of what somebody will pay.

2. If buyers are coming, but no offers, you are 5% to 10% wrong on price.

3. If nobody is coming, you are at least 10% off on price.

If you have been listed for months, and your agent isn’t telling you to lower your price, then go pound your fist on their desk and demand that they lower it today at least 5%, and another 5% in two weeks. Keep doing that until buyers start writing offers, and then sign one.

There are agents that want to hold on price, thinking that somebody will eventually come along. You need to weigh the odds of the miracle sale with your need to move. If you’re not ging to give it away, your high price helps your neighbors sell their houses, so they’ll appreciate you. But this environment, don’t think that a buyer is going to come along and pay your price because you have the only house with heavy-duty nails.

Buyers don’t care about your improvements, they want those for free. They want a deal, so if you want to sell bad enough, that’s the formula!

The buyers’ expectations of what they’ll pay for your house go down by roughly $1,000 per day the house is on the market. Sellers, if you aren’t lowering your price by at least $30,000 per month, you getting left behind.

source: bubbleinfo.com

[MomToTwoBoys]

I find the pricing rule of thumb to usually hold true in most places. I have many friends that use to be brokers, realtors or mortgage brokers....sigh..now with the economy they say this still holds true. Not sure about Canada real estate but my understanding is the same in this economy. If you have on the market so many weeks and no bites or too low of offer you are too high for market in your area. I know you have did lots to the house , have a beautiful home and are disappointed . Hope it sells soon and you don't have to lower.

Here is an excerpt from a Realtor in California explaining rule of thumb:

Pricing Rule-of-Thumb

Some people have said that I should write a book, and I respond – “I have!”



But the most important one is the pricing rule-of-thumb.

A seller called yesterday and wanted to know what was wrong with her listing agents. She’s only had a couple of lookers over the last several months, and thought the agents should be doing something more/better/different.

I asked her about price, and she said that they had put in more than $200,000+ in improvements, but were only listed for $100,000 ABOVE what they paid a couple of years ago.

If you bought your house between 2004 and now, and you want to resell it, expect that buyers will only want to pay LESS than you paid, not more. With one click they’ll see your sales price and date, and not bother to hear about the deluxe sun room! So either sell for less, or don’t sell.

How much less? Here’s the formula:

1. If buyers are making offers, you price is about right – w/i 5% of what somebody will pay.

2. If buyers are coming, but no offers, you are 5% to 10% wrong on price.

3. If nobody is coming, you are at least 10% off on price.

If you have been listed for months, and your agent isn’t telling you to lower your price, then go pound your fist on their desk and demand that they lower it today at least 5%, and another 5% in two weeks. Keep doing that until buyers start writing offers, and then sign one.

There are agents that want to hold on price, thinking that somebody will eventually come along. You need to weigh the odds of the miracle sale with your need to move. If you’re not ging to give it away, your high price helps your neighbors sell their houses, so they’ll appreciate you. But this environment, don’t think that a buyer is going to come along and pay your price because you have the only house with heavy-duty nails.

Buyers don’t care about your improvements, they want those for free. They want a deal, so if you want to sell bad enough, that’s the formula!

The buyers’ expectations of what they’ll pay for your house go down by roughly $1,000 per day the house is on the market. Sellers, if you aren’t lowering your price by at least $30,000 per month, you getting left behind.

source: bubbleinfo.com

Wow, I can tell that was written for California. $30k per month? Oh my.

Thanks for it, though! It sort of reaffirms my thoughts that perhaps we need to drop it another 5%. With another 5% off, that actually puts us right where we'd need to sell to make a decent profit.

[MomToTwoBoys]

DH called tonight and we discussed the house. We've come to a mutual agreement that if the house doesn't get another showing by Friday, we call the realtor. We'll have him do another price reduction and then wait. If the house still doesn't sell by December 15th, we tell him that we're pulling it off of the market until the spring. We've also decided that we'll be looking for another realtor. We're going to try with one of the larger corporations and see what we can get.

[LuLuBleen]

MTTB - First off, sorry you're having so much trouble selling your home. This market is just terrible.

If your husband's commute is stressing out the whole family, maybe it's better to just get out now? Is there any firm indication that the market will improve very much by spring? I'd hate to see your family endure all that aggro for not much return.

At least this all can help you when you go to buy. Maybe you won't need to make the profit you originally thought to get the right house where you want to live?

And, yeah, maybe it's because I live in California but every Realtor I know swears that they can sell any house IF it's priced correctly. Just something (annoying) to chew on.

[MomToTwoBoys]

Yeah I'm thinking that it really is for the best that we get out now. Prices usually go up in the Spring and that's because the market warms up with people buying houses and not wanting to uproot their children in the middle of the winter.

I'm calling the realtor tomorrow and having him come over Saturday. DH sounds like he's depressed and tired at the same time, plus he's having trouble adjusting to a new place of business. We'll reduce the price on the weekend and see if we get bites.

[Libby]

Have you asked your realtor to hold an open house for agents only? This lets other agents know about your house and they can do the trickle down effect and get the word out to their clients.

Have you tried staging the home like in a magazine? Hide all your clutter, organize the closets so its 'pretty' and place simple clear glass vases with a tiny flower in it on the dinging table, coffee table, mantle, bathroom etc etc. Make your home look 'shee shee poo poo' just like Style & Home. Sounds silly but have you tried the baked goods smell flowing through the house? It helps others viewing the home picture themselves living there baking themselves. Maybe buy a cheap cake display holder an place a plate of freshly baked (bite sized of course) cookies in there during open house w/water & cups?

Maybe have the realtor change the wording on the MLS page since its not attracting many people. Did you change the pic of the dumpster in front of your house? Maybe make that a 2ndary shot to show the new roofing.

Is there a rule or clause in your contract with said realtor stating that you can't list it on your own? I see a lot of homes going up for sale here and its listed by owners. Have you tried: Property Guys.com

Just tossing out ideas for you to help make sure you've exhausted all your avenues before you drop your price again.