A property is too long on a market. Is it good for me?

A property is too long on a market. Is it good for me?

Investor · Brooklyn, NY · Member since 2014 · 231 posts · 12 votes

Dear BP friends,

I found a property which I liked but it was on the market for 165days.

Why would a good property be on the market for so long? What am I missing?

Thank you all in advance

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Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
7y

It boils down to the price is too high for the conditions and local market

See this reply in the discussion

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  • New to Real Estate · Member since 2018 · 29 posts · 24 votes
    7y

    There could be tons of reasons.

    Most commonly I suppose is that potential buyers inspected the house and found something which is a deal breaker for them.

    For example, a structural problem or a roof which needs replacing right away and the numbers don't work after you put in that expense.

    I guess it won't hurt to call and take a look and if all looks good to you then to do your checking into that property closely to see you aren't missing anything.

  • Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
    7y

    It boils down to the price is too high for the conditions and local market

  • Kenneth GarrettPro Member
    Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
    7y

    @Eli M.

    Houses that have been on the market a long time are ignored for the same reason you think.  There must be some major problem with it.  I have bought a number of houses like this.  The competition believes if everyone else passed on this house it’s not worth it. 

    I bought a house that was on the market for over 400 days.  It rents for 1620/month and cash flows 400+/month.  It needed a lot of work but worth it.

    Don’t ignore those.  It’s all about timing.

  • Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    7y

    What is the average DOM for the area? 165 days is a LONG time in most markets. One would assume it is probably well over-priced. 

  • Rental Property Investor · Upstate, NY · Member since 2012 · 3k+ posts · 3k+ votes
    7y

    I watched a 1890's farm house converted to a duplex for 18months. It was 3bedrooms & 2 full baths on each floor. It had a huge barn & the double lot was 800ft deep. Original price was $86k. The heirs had assumed control & didn't want anything to do with the long term C-class low rent tenants & necessary repairs. Inspections kept rejecting conventional financing & even after installing new furnaces & HW tanks it failed to get approved. My partner bailed on the buy once he assessed the work needed.

    The tenants finally left & the price dropped to $63k so I went in @ $42k, cash, close in 30, no conditions. I didn't hear anything for a week & then got it.  Flipped it to a contractor friend for $67k & hold the note @ 12%. They have since completely rehabbed it.

  • Real Estate Broker · Bay Area · Member since 2018 · 1k+ posts · 3k+ votes
    7y

    Hi Eli,

    A house sitting on the market for 165 days is a good thing if you are a buyer bad if you are a seller.  For whatever reason, the house has not sold and as each day passes it gives you a buyer a better opportunity to get a better price. 

    You don't know what is wrong.  It could be issues with the house sellers could be stubborn and won't sell unless its a specific price.  Some of my best purchases and the ones for my clients have come with homes in this exact situation.  Time for you to do some investigating.  Have your agent call and do some homework.  Things to ask. What is the situation with the seller?  Any inspections on the house? Where are your clients on price?  Once you start probing for more info the listing agent will begin to share.  

    Once you have the information you can now make an informed decision to move forward with an offer or pass on it.

  • Davis, CA · Member since 2016 · 595 posts · 344 votes
    7y

    find out WHY it is sitting.  many times once a house has passed its retail sweet spot... people assume, like you did, that it must have a real issue..  and will look past it.  evaluate every house you look at on its own merits, dont assume why it is sitting.  My first flip (in deal diaries if you care) sat for a long time.  house was funky, bad realtor, over priced at the start...  got it for a steal and killed on it.

  • Real Estate Broker · Minneapolis, MN · Member since 2016 · 530 posts · 398 votes
    7y
    @Eli M. House has some sort of liabilities. But some investors with varying risk tolerance like houses with longer DOM being able to spot different opportunities within. Goes both ways! Either way I’d put in much more due-diligence. Dig into the Listing ad or OM as much as possible lol
  • Member since 2018 · 211 posts · 164 votes
    7y

    I WONDER THE SAME THING ABOUT GOOD HOMES THAT FALL OUT OF ESCROW AND END UP BACK ON THE MARKET

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