What should my company know about homes going into inventory?
Dealing with homes in inventory is critical for mobility programs. Manager of Real Estate Inventory David McMurtrie has more in this Relo Tip Tuesday.
Complete transcript: “Hi, I’m David McMurtrie, Plus’s manager of home sale inventory, here to answer the question, ‘What should my company know about homes going into inventory?’ One of the most important ideas is to have a pricing strategy that gets the home sold quickly and for the least amount of loss to the corporate client. Let’s take a look at what goes into pricing.
First, while the real estate market speaks of appreciation and depreciation, the reality is that the markets are in constant flux. If a home has appreciated four percent over the last year it is unlikely that it appreciated at one percent a quarter. Rather, it is more typical that it would have had constant peaks and valleys throughout the year. And while it is important to follow macroeconomic and real estate data, the truth is the only data that really matters is what’s going on in that neighborhood while the home will be on the market.
There are two critical pieces of data to evaluate when any home comes into inventory. First has anything changed locally since the appraisals were conducted on the property? If a major employer has announced a plant closure in the area this will require an entirely new strategy to get that property sold. Second, how large is the buyer pool? A $250,000 home in a rural area could prove to be far more challenging than a million-dollar home in a major metropolitan market.
Once these two items are factored in, the relocation management company can make appropriate pricing recommendations. In general, the best results are achieved by aggressive pricing designed to sell the house within the first thirty days on the market and proactively making price adjustments if the home remains unsold thereafter.
The old real estate saying that time erodes price is never truer than in a corporate inventory scenario. Holding out for a better price generally results in a lower price and greater carrying costs. Remember getting the home sold quickly generally produces the best results. Thanks for watching!”