Property values still going down? Why?

If you wonder why property values are still 'adjusting' - there's actually a pretty good reason and it's not what you think!

When an owner wants to sell their property and contacts an agent, the agent does what is called a "Comparable Market Analysis" in which they compare the values of properties on the market to the owner's home to determine a fair price for it.

There are however two approaches to this - one is ethical and one is not. Many agents these days, in an effort to get the property sold quickly, drop the asking price on the home below that of all the other homes being sold in the area. Then when an offer comes in, they do everything they can to get the seller to agree to the offer, even if it is far below the low asking price! This, of course, is not the right way to sell a home!

This is happening all over the country! Agents, in an attempt to get the homes sold, are not educating their sellers and explaining that the sale needs time to mature and that they have to be willing to hold out for a fair offer. Instead, they are 'throwing the baby away with the bath water' and pressuring the sellers to agree to the lower price instead. This in turn is causing other listing agents, who are following the same tactics to lower the asking prices even further.

The problem is that the sellers don't understand the importance of time. It is imperative that all sellers stick it out and sell their properties for what is fair - not what is fast. By agreeing to market a home lower, it inevitably hurts the property values in the entire community thereby making it more difficult for everyone concerned to get a fair price for their home.

Agents who undercut other agents in an effort to sell a home quicker are working from a lack of experience, lack of ethics and general lack of concern for the market, their customers and the community. It is important to shop for an agent that is willing to market a home for what it's worth and it is important for the seller to understand that taking less for their home is not the best choice over taking their time.

The reason property values continue to spiral downward is because agents are not using skill, care and diligence as they agree to on their listing agreement, to ensure that their seller is going to get the right price for their home. Instead they are selling the seller short and cutting their losses because they lack the experience to explain to a seller how important it is to wait for the right buyer. If agents and sellers alike adopted this philosophy, the market would be strengthened in the seller's favor and the buyers would have to be more reasonable again.

I have seen many too many buyers take advantage of misinformed sellers and unqualified agents. It is not an agent's job to sell a house - it is the agents' job to market a home and get the fair market price for the home and also create a win-win situation between buyers and sellers. It is unethical and unreasonable to expect a seller to suffer a tremendous loss in order to sell their property. It is time for the sellers to understand how important it is for them to stick to their guns but unfortunately unless all sellers collectively do this, the home that is priced below all the rest is still going to be the home that sells first and the agent who lacks the wherewithal to sell the home correctly will get a shorter paycheck but will be paid ahead of everyone else. Ultimately this is the motivation of an agent who undercuts the value of a seller's property to get it sold. It is all about the money!