Question:
“My wife and I have had our home on the market since October, at $825,000 and it hasn’t sold. Our agent told us to reduce the price. But we don’t want to lose money. What should we do?”
Answer:
I hear that often and am sympathetic to your plight.
But it sounds like you’ve ALREADY lost that money, whether you reduce your price or not.
In other words, the act of reducing your price isn’t what loses you the money. It’s the other way around. You have to reduce BECAUSE the value is less than you thought.
Reducing your price is the symptom of a lower value, not the cause.
Should you reduce?
- YES, if you’re better off selling the home at its current value.
- NO, if you’re better off keeping it given its current value.
On another note, I don’t know what you paid, so I don’t know if you’re literally losing money.
Some people who sell their homes for a profit—but not for as much profit as they’d hoped—say they “lost money.”
But if they never had the money (because their home was never worth that higher price), they couldn’t have lost it!
