The Biggest Discounts Aren't Negotiated—They're Accumulated
One of the hardest conversations I have with sellers is about price reductions.
No one likes lowering the price. Not myself, not the sellers. It just feels bad all around. But for a moment let’s see it for what it really is: in a market like we’re currently in, sometimes a price drop is one of the MOST strategic decisions a seller can make.
Here's why.
(And by the way, I’m talking about normal homes in Bellingham here. A condo at $375k, or a large family home at $1 million. Maybe a waterfront home at $1.6 that you could find/replicate again.This does not necessarily apply to exquisite, ultra-luxury or truly one-of-a kind homes.)
Here’s why a price drop can be incredibly strategic, and worth applauding. Imagine two identical homes. Both come on the market at $1,300,000. They're equally beautiful, equally well-prepared, and equally desirable. The only difference is how the sellers respond to the market.
Home A
After about two weeks, showings have slowed. There hasn't been much activity.
The sellers make a strategic decision to reduce the price to $1,250,000.
The adjustment puts the home in front of a new group of buyers. Showings pick up. Interest increases.
An offer comes in at $1,235,000.
Most people remember this story as, "They had to reduce the price by $50,000."
I see it differently.
That early adjustment may have protected another $55,000 by preserving the seller's negotiating position.
Home B
This seller starts at the same $1,300,000, but decides to wait. He thinks, “Let's give it more time."
Thirty days pass. Then forty-five. Then sixty-five.
Eventually, they make the same price reduction to $1,250,000.
But something has changed.
Not the house. The buyers.
Instead of seeing a fresh listing that has been thoughtfully repositioned, buyers begin asking different questions.
"Why hasn't it sold?" “What did everyone else see?" Or, "If they've already dropped $50,000, maybe they'll take another $50,000."
An offer finally comes in $1,180,000.
The price reduction was exactly the same. The outcome wasn't.
What Changed?
The market didn't negotiate away that last $55,000. Time did. Because every additional week a home sits on the market changes the psychology of the negotiation.
Buyers naturally become more skeptical. They wonder why previous buyers passed. They assume the seller may be getting more motivated. They become more confident making aggressive offers because they believe time is on their side.
None of that has anything to do with the condition of the home.
It's simply how people think.
This Is Why Pricing Is About More Than Numbers
When I recommend a price adjustment, it’s because I'm trying to protect my clients' leverage. There's an important difference between a seller who adjusts after two weeks and one who adjusts after seventy-five days.
When buyers see an early price adjustment, they think:"They're paying attention to the market." Or, honestly, they might not think much about it at all.
But when buyers see a late adjustment…that house they’ve seen every day for 6 weeks… they often think: "LOL, Finally."
Those are two completely different starting points for a negotiation.
The Goal Isn't to Avoid a Price Reduction
The goal is to achieve the best possible sale.
Sometimes that means holding firm because the market (my Comparative Market Analysis) supports your price. Sometimes it means making a thoughtful adjustment before the market begins writing a different story about your home. That’s where your trusted real estate advisor comes in.
After a decade of selling homes in Bellingham, I've come to believe that the biggest discounts usually aren't negotiated, they're accumulated over time. I'm often less concerned about today's list price than I am about tomorrow's negotiating position. (This is also why I believe in Compass’s 3-Phase Marketing approach which at this time we are sadly unable to employ here in WA State…but I digress.) Protecting your leverage is often worth far more than protecting your asking price.