Why won't this home sell?

[Leigh Ann Smith]

A friend of mine owns the home at 1808 Hickory Glen Rd, Knoxville, TN 37932.  It's been on the market for a very long time (well over a year, I think), and I don't believe they've ever even had an offer. I told her I would check here to see if anyone had some insight to share. My guess is that the problem is just that it's a high end house (listed at around $500K), and there are only so many buyers for a house like that.

If you are familiar with the Knoxville market, perhaps you could share your opinion.  Is it overpriced?  Is the market bad there?

Just a note...these people want to sell, but they are not what you'd consider "motivated sellers".  

[William Ellis]

I live right around the corner from there in a similar neighborhood. The house we bought was on the market for a year and the price came down by 60k before it sold. The house across the street from me has went from 600k to 495k over the past 18 months and still has not sold. In this area that house price is 4 to 5 times the normal priced home. It should eventually sell but it may need to come under 500k even at 5000 square feet. Our home is 6000 square feet and we bought it for less than your friend is asking.

We moved here from Maryland and tripled our house size with the same payment. East TN is a high poverty area. I would say knock it down under 500k so that with 20% down it takes it out of the jumbo loan category and then wait for the right buyer. It is in a good school zone which is not typical here so it will eventually sell.