Ever wonder why a particular home is so overpriced? Why a seller seems so unreasonable, or why the house seems to be in such poor condition for showings?
Realtors often encounter sellers who are unwilling to see their homes objectively, in particular when it comes to price. It forces the agent to make a decision pre-listing: take on the overpriced, poorly presented listing… or move on.
All Realtors have been in situations where they’ve engaged with a seller unwilling to acknowledge the realities of their market. I refer to this exercise in futility and frustration as “Realtor Stockholm Syndrome””, and it rarely ends well.
The definition of Stockholm Syndrome, according to Wikipedia: a psychological phenomenon in which hostages express empathy and sympathy and have positive feelings toward their captors, sometimes to the point of defending them. These feelings are generally considered irrational in light of the danger or risk endured by the victims, who essentially mistake a lack of abuse from their captors for an act of kindness.
Recently, I spoke with an agent about a home that she was days away from listing. She sheepishly shared the list price with me, and seconds later told me that her recommendation to her client was that he list his home for 25% less. Knowing that the home can’t possibly sell for list price (even in our current frothy market) – let alone appraise at that price – the agent is entering “”Realtor Stockholm Syndrome”” territory.
If the house is indeed as overpriced as the Realtor has suggested it is, it will sit. Potential buyers will sense a stale listing, and the seller will eventually need to take the painful price reduction that was necessary from Day One. At that point, months later, its “staleness” will drag the eventual sales price down lower than what they would have sold their home for if it was priced correctly to begin with.
This isn’t to say that I don’t feel empathy for a seller who might be underwater, or who can’t afford to sell their home for current market value. These are difficult conversations, to be sure.
Ultimately, home sellers are better off understanding their local market and embracing their reality. While there are plenty of reasons for Realtor Stockholm Syndrome (personal relationships with sellers, a non-confrontational/“pleaser” mentality, really wanting or needing a particular listing, etc.), it’s the job of the real estate professional to maintain objectivity and expertise. It is (theoretically, at least) the reason for our professional existence.
If you’re a home seller, listen to your Realtor. They may not always tell you what you want to hear, but it’s likely what you need to hear. If the price that you’d like to sell your home is completely unrealistic and not even remotely supported by the market around you, you may be setting yourself up for a long, disappointing process.