A few weeks ago, I wrote an article about not testing your home with a price higher than market value. But what if you are priced well but still have not seen any offers? At what point do you consider a price reduction and how much is reasonable?

There is no magic formula for a price reduction and I haven’t seen many people that can accurately predict the future. I did, however, spend $3 once on a fortune teller at the Sonoma County Fair. She told me in the next year I would not win the lottery, I would not be buying a small island in the Caribbean, and I would not be spending the next 30 years sipping Piña Coladas while being fanned on the beach. So far, she was right.

But there is an unwritten rule. If you and your Realtor have priced the house according to the most recent sales and listings around you and your home still isn’t getting offers, a price reduction may be necessary.

Most agents will recommend you keep your home on the low side of your competition. Being the best deal on the block usually gets the most attention in any market but if that still isn’t doing the trick, it’s time to do some math.

The rule of thumb is if you haven’t received a full price offer in the first 10 days, chances are, you won’t. The gauge of interest is measured by the amount of offers you have or don’t have as well as the amount of traffic you are getting or not getting. No traffic plus no offers equals no money.

If you aren’t entertaining any offers after two weeks, consider a price reduction. Try a two percent drop in the listing price and see how the next week goes. If you still haven’t seen any change, you may want to look at a drop of one percent for every week you are on the market. When you drop your price, try to do it early in the week so people have a chance to see it before the weekend when most people do their house shopping.
Having an open house after a major price reduction is always a good idea to get people to come back especially if they have seen it before and felt the price was too high.
 
Ken Schrier is a licensed Realtor for CPS Property Advocates in Rohnert Park. His focus is working with buyers and sellers throughout RP, Cotati, and Penngrove. He can be reached at (707) 529-4819.