House #9: Price Reduction

July 5, 2009 · 5 comments

I’m thrilled to say that in all the time we’ve been doing this, we’ve yet to have to reduce the list price of a house that we’ve put on the market. But, unfortunately, that streak came to an end this weekend…

We dropped the list price on The Hat Trick House from $109,900 to $99,900. We knew going in that it was unlikely we’d get any offers at the $109,900 price, but given that The Red Garage House down the street got a near-full-price offer for $109,000, we decided something in that range was a good place to start.

But, now that it’s been almost three months since we bought the house — allowing us to sell to FHA buyers — we’re ready to get this one sold. Even at the new price, if we get a reasonable offer, we’ll make a good profit on this one, so I’m not concerned about the price drop. But, I had gotten accustomed to quick sales at near full-price, so in that regard, I’m a bit bummed.

We didn’t get too much traffic this weekend, but with the 4th of July holiday, that was to be expected. Plus, because we were out of town for the weekend, the houses were locked up and alarmed; the agents that did bring buyers by had to disable the alarm system, turn on the lights, and open the blinds themselves, all of which takes away from the first impression of the house. So, I’m not expecting any offers from the lookers this weekend.

I’m curious to see if we get more traffic this week, or if summertime is slowing things down. Since we aren’t actively marketing any other properties, I’m really not sure if there are a lot of buyers out there right now or not…

5 responses to “House #9: Price Reduction”

  1. Shae says:

    Hey Scott, I doubt that summertime in Atlanta would slow things down too terribly. There are plenty of buyers out there for your property! A week from now you’ll probably be reporting that you have a contract on it 🙂

  2. J Scott says:

    Thanks Shae…I hope you’re right! 🙂

  3. Joy says:

    Hi Scott,

    I’ve been lurking for quite a while on your blog and I have to say…I LOVE IT! It’s been very inspiring to me. I’m hoping to hear back tomorrow on my offer for what I hope will be my first rehab & flip.

    As far as the Hat Trick House goes, I have one “suggestion” – have you thought about adding hardware to the kitchen cabinets/drawers? I see that you have them on the Red Garage House and, although the kitchens look similar in terms of finish levels, etc., the Red Garage House just looks more “done” to me because of that. It says “home” to me, and the Hat Trick house’s kitchen says “house” to me, if that makes any sense. Not that I should be giving you suggestions….you’re miles ahead of me.

    I have a question for you – how do you determine the finish level of the flooring for your houses? I have a pretty good handle of the finish level for most of the house I am offering on, but I’m really stuck on the flooring. Carpet would be most economical and would be in line with most of the neighborhood. New, neutral carpeting would be ahead of most comps, which either have older carpeting or new but very taste-specific carpeting (off white with a bright red border?) But there’s a house, same neighborhood and similiar size, type, etc., that is on the market for about $40k more than I plan on listing my (hopefully) house at. It’s a rehab and flip too. This house has new hardwoods. I’m really not at all certain that the extra $40k is realistic in the neighborhood, but obviously, the floors really look fantastic. What would you do in that type of situation?

  4. J Scott says:

    Joy –

    Thanks so much for the compliments on the blog, and congrats on your first deal!

    As for The Hat Trick House, thank you for the reminder. We actually have had the cabinet hardware sitting on the counter in the The Hat Trick House kitchen for a month now, but haven’t installed it yet. This is great feedback, and I’ve added it to the top of my to-do list for this week.

    As for your question about finishings, I’ve gotten that question a lot. I’m going to put together an article on that topic this week, and will let you know when I post it. Thanks again!!!

  5. J Scott,

    Wanted to thank you for answering my questions on flipping I love your website and I am going to get my partner (my brother) who is very gun shy right now, to take a look. We did our first flip last year, August and got burned for about 10k by our GC, but we got the house done and it sold in 78 days for 151k. We did loose money, but I know we paid too much for the house. The only reason we sold that house is because of the re-hab work we did period. We had almost a 98% approval rating on all the walk threws. Our hard money lender was so impressed that he is using our house in their advertisements. Joy, I read your question above and we went with carpet in all bedrooms but laminent wood through out the house and every one that walked through was very impressed. Thank you again J. Scott for a great site!!!!!!

    Daniel Frisce
    San Antonio, Texas

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