The Money You Never Had

One of the most common objections I hear from Minneapolis duplex sellers is they need more for it than the market suggests it’s worth.

When it doesn’t sell at that number and we are forced to reduce the price to what the market suggested it was worth, they insist they’ve lost money. That’s like buying a lottery ticket and when the numbers differ from those drawn, claiming lost millions.

Duplex buyers determine value. Not the listing agent and not the seller.

They want to find a property in the best condition and that’s the best value for their wants and needs. If they’ve been looking for a while, they’ve seen competing listings and quickly recognize when an overpriced listing comes on the market. And if they have interest, the high price is an invitation to negotiate with the seller; especially if the property has lingered on the market for a while.

Of course, negotiations often include not only price reductions, but inspection items as well; likely resulting in even lower net proceeds to the seller, or more money “lost”.

On the other hand, if a duplex looks like a good deal, multiple buyers rush to see it.  If they perceive value, they are quick to write an offer. And in an effort to win it, sometimes they are willing to forego an inspection or asking a seller to pay their closing costs. Of course, this ultimately increases the net dollar to the seller, resulting in them netting more money and “losing” less.

Remember, a property is only worth what someone is willing to pay for it, not what a seller wants or needs out of it. The listing agent works on commission, and while we certainly would like it to sell for more than market value too, our job is to use help a seller net as much money as possible.

And while it’s counter intuitive, the best way to net the most money is to price it right in the first place.