Prudential Value Range Marketing
By Charles Turner
Value Range Marketing was created a number of years ago in an attempt to bring sellers and buyers together in a challenging market. We’ve used it in the past but not recently, until today.
The idea, at the most basic level, is that any offer is better than no offer. If a buyer feels that a house is overpriced, they may move on when it is really the house they want and the seller was willing to sell it for a lower price. None of that can be conveyed in a fixed asking price. The range doesn’t mean the seller is willing to sell at or anywhere near the bottom of the range. It does mean that they won’t be insulted by an offer at the bottom of the range and outright reject it. They’ll negotiate which is the first part of any sale!
In this case, the top of the range is a price drop. We were listed at $850,000 and the range is $750,000- $848,876. The ,876 in the pricing allows a PVRM property to be seen when listings are presented in list form. We hope that the price drop and the creation of the range will help get the house sold in an area with an increasing inventory homes.
One note about RMLS and PRVM. RMLS only allows the high end of the range to appear in the listing- we have to put the PRVM portion in the remarks like this: “Seller will consider offers between $750,000- $848,876.” Some MLS systems allow for the range to appear so it is returned in more searches.
Sorry but VRM is flat out retarded.
The only thing it was useful for was in the rapidly rising market to catch the eye of buyers who where searching for houses below the price range that was being asked.
That enabled RE agents to talk them into “Stretching a bit to get their dream house/investment/nest egg” and signing their own financial death warrant.
As a buyer in this market I consider the bottom boundary as the ask price and offer whatever I think reasonable below that.
To be honest there isn’t a house in Portland I’d buy until there is more blood on the streets. Sellers need to bleed for a year or two and the foreclosures to rack up before we get back to sanity – year 2000 prices + inflation adjustment.
Why 2000 ? that was when the ponzi scheme that has been the lending environment started – before that price was based on the borrowers ability to pay back the loan.
Uncle Git.
2000 prices, as if.
In housing recessions the decline always undershoots (e.g. goes below the previous trough).
Sure – but fair price when compared to rent equivalent is the point where it makes sense for me to buy – if I find the right property.
If I don’t find the perfect property I can quite happily wait out the storm longer and get something that’s undervalued further down the crash.
Until then I’m not even bothering looking.
Was at a party in SE last night when someone said that the Portland she moved here for a few years ago now seems to be gone. That started a lively discussion in which most agreed that the rapid increase in housing prices has left them unable to even think about buying a house here. It’s as though the whole city gentrified in about 3 years while most of us weren’t paying attention. One person asked the “But doesn’t everyone want to move here?” question, but the general feeling was that most of the young people that were moving here didn’t have good paying jobs and that perhaps that demographic is being replaced by wealthy people who are moving in and completely changing the culture and feel of the city. Only the wealthy can afford to buy now. The creative artistic types that Portland has become a mecca for aren’t able to buy. It’s just sad.
“The creative artistic types that Portland has become a mecca for aren’t able to buy.”
Austin, TX.
Portland is one of the best places in the world to live. There are tons of people hanging on, waiting like Uncle Git, to buy. They can’t all wait forever.
IMHO, the bottom isn’t going to fall out of the Portland market. However, this is a good time for patient buyers to find great deals, because lots of people don’t have the luxury of timing the sale of their house at the market peak. Those who simply wait on the sidelines for average prices to fall below an arbitrary level risk missing out on unique opportunities in this buyer’s market.