This is a true story, unfortunately.  Only the address has been changed.

On September 13, 2005, I visited with owners at 12 Nice Lane in Franklin Township and presented my market analysis.  On the relocation company form I indicated a most likely sale price of $330,000, and a recommended list price of $335,000.  I based that on what I saw happening in the market, and the relocation company’s desire to have a 90-day sale.  I never heard from the owners again.

On September 19, 2005, the property appeared in the MLS with an out-of-area broker, listed at $344,900.  On October 3 the price was reduced to $339,900.  In October, the owners moved out of state, and the home was now vacant.  On November 6, 2005, the price was reduced to $334,900 (my original recommended price), as the market headed into a pronounced holiday period that would last through the following March.  The property was withdrawn from the market on December 9, 2005, and re-listed by the same agent on December 12, 2005.  The new list price was $329,900.

The market continued to do what I anticipated it would do – it became very quiet as inventories rose and buyers stayed away in droves for the holidays.  Finally, on February 7, 2006, 141 days after listing, the property went under contract, and closed on March 7, 2006.  The sale price was $320,000.  The owners priced the property $10,000 over market, and ultimately took $10,000 under market.  And, of course, they were continuing to make mortgage payments the entire time – six mortgage payments plus $155 per month association fees.  Their monthly payment was close to $2000 per month. 

It took three months for the property to sell after it was listed at my original price – that was the period that the relocation company wanted.  But, of course, by that time the market had changed from a slowing one to one in full holiday form.  It is unlikely that had the property been listed properly initially it would have taken three months.  The owners not only took $10,000 less, but suffered a couple of extra mortgage payments at $2000 per month. 

The moral of this story is one from the stock market: bears make money and bulls make money, but pigs get slaughtered.