It’s funny that I mentioned my lots in St. George on my post just two days ago where I said, “I have no idea how my lots in St. George are doing. I’m too afraid to call my realtor. I figure that I’m probably down $10k on each one.”
I got an email from my realtor this morning. The email said:
There has been some serious reduction in the competing lots …recently. Would you like to reduce the price of your lots to remain competitive? Please let me know by responding in writing to this email. The lots range now from $88,000 – $110,000. Yours … at the top end. If you wish to come down but not exactly to $88,000, you may want to consider at least $92,000. Please let me know what you would like to do. General activity in our market is very slowly improving.
Well I’ve been thinking of dropping the price for a while now. I’ve seen homesellers here in Phoenix and California do the $2-$5k drop per week thing and they’ve ended up dropping the home around $20k-$25k total with no luck. I do not believe that reducing prices by $5k or less will help you sell in this market.
I think that you need a drastic drop to bring in buyers. I’ve seen sellers drop prices $50-$60k and immediately get their homes sold back in June 2006. I’m sure they are happy because the surrounding homes using the $5k reduction steps have come down to their price finally but are still not selling.
With that said, I don’t think that dropping my lot prices to $88k or $92k to equal the competition would make them sell. I’d really like to get rid of one lot to free up some capital. I’m willing to take a loss a lot. I know can make up the loss with the freed capital. Therefore I told my realtor to price my lot at $75,000. I’m 15% under the next closest listing. If I don’t get any action at that price, there’s no way the lots at $88k will…