It’s been months, and your apartment still hasn’t sold. Here are some possible explanations and suggested approaches:
1. It’s overpriced. If your property has been on the market for 30 days and has not received an offer, you will need to reevaluate your pricing and determine if it’s the asking price that’s dissuading buyers. However, you or your broker should be periodically checking on your competition. If they adjust their pricing, you should be prepared to do so as well. This question should be asked again every few weeks if your property continues to remain on the market.
Price reductions can be by as little as 5% or as much as 10% percent. Large price drops occurring all at once should not be required if the listing was properly priced, to begin with. However, if you decided to “test the market” with a high price at the outset, consider getting back on track with your first price adjustment.
2. Lot-line windows will be permanently bricked up soon due to construction next door. Cut the price, or take the apartment off the market until the windows and possibly the construction are done.
3. There is a huge construction site next door. Drop your price and/or install soundproof windows, or take your apartment off until the construction is done. Buyers typically have more fear of the unknown when a building has not broken ground, once it is completed, they will understand much better how it affects the enjoyability of their home.
4. The maintenance or common charges are too high. Reduce the price and/or consider offering to pay 6-12 months of these costs as an incentive.
5. There are pending lawsuits in your building. There’s no easy solution. You can only control the price, which may have to be adjusted to compensate for the perceived risk. Consider disclosing these early on to a serious purchaser and have a good understanding of the issues being litigated. There’s no point in having it come out for the first time when contracts are out with the attorneys. You might also want to have your agent speak with several lenders to see if the lawsuit will affect a buyer’s ability to obtain financing in your building.
6. There are too many apartments for sale in your building. You will need to really stand out. Consider non-price options such as staging, catered open houses, etc. However, you will need to be priced more attractively than the rest of the pack to elicit offers.
7. There’s nothing special about your apartment. There is one surefire way to get more buyers to at least consider your apartment, make it stand out to their brokers. Offer to pay the buyer’s broker a higher commission–say, 4% instead of the standard 3% co-broke. Add a deadline to spur even more interest.
8. The board turned down your buyer because the price was too low. This is more common than you think, as boards–whose members also own apartments in the building–engage in a possibly misguided effort to preserve property values. Courts have ruled that boards can turn buyers down for any reason except illegal discrimination. However, your attorney may be able to restructure your deal in a way that pleases you, your buyer, and the board.
9. Your co-op has a land lease that’s about to expire or an underlying mortgage is about to come due. Cut the price, or take the apartment off the market until the new land lease or mortgage is in place.