As a Keys buyer, how much of the list price should you offer? If you’re a seller looking to stir up activity on your listing, what does our market tell us is a normal list-to-sale price reduction?
Sellers who don’t see enough activity during the initial term of their listing (i.e., few showings and no offers) likely need a price reduction. In our area, it usually takes an average price reduction of 5% off of sellers’ original list to get offers flowing in. Then, depending on the marketplace, we’re seeing buyers come within 4% to 5% of that new list price. That means most sellers can expect a total list-to-sale price reduction of around 9%, though that figure varies from the Upper Keys down to Key West.
On the flip side, if you’re a buyer who’s discussing a property’s history with your agent, you’ll first want to check if there have been any price reductions. If a property is priced quite aggressively or you see that there’s been a fairly standard price reduction, then you’ll know that coming in at 4% off of list price—that Keys-wide average—is a strong place to start. Naturally, everyone wants to negotiate for as much as they can get, but avoid lowballing the seller. To have a seller counter your offer is normal, but you don’t want to come in so low that the mere thought of humoring your offer is offensive to them.
As always, reach out by phone or email if you have questions about this or any other real estate topic. My partner Lela and I are happy to be resources for you and assist with whatever buying, selling, or investing needs you may have.