I did an interior BPO a week or two ago on a rural property out in a kind of exclusive part of Santa Cruz county. None of the homes are alike, the parcel sizes and qualities are all different, the houses range from brand new estate-type properties to...well, older estate-type properties. There are probably a few normal houses thrown in here and there, tucked away behind different hills and knolls.One thing I sure hate to do is tell a client the asset is worth more than it is. Hate it. So I spent a long time on that BPO, weighing various factors, and came up with a price that I was sure it would sell by in 30 days. This is in a very desirable area, where there have not been any REOs in recent memory.The listing hit the streets today (not mine): $100,000 lower than what I said in my BPO. Yowza. That ought to sell in a matter of days. I expect I'll see it 'pending' here by this time next week, unless they get multiple offers (very possible) and the process drags on a bit.But it's a point well taken. I have another REO listing - big, beautiful, 5-year old house, the kind that everyone in town wants to buy (if they can afford it). I listed it based on the active comps and recent solds - lower than all the active comps, lower than all the recent solds (most of them also REOs - or short sales). Actually, lower than all solds for all time in that subdivision.And then, one after another, new REOs came on up and under-cut my asking price by 10%. And they went into escrow, blip blip blip. And then the short sales in the neighborhood dropped their price. And now, suddenly, in a matter of 3 weeks, the listing goes from the best priced in the neighborhood to practically the highest priced.The lesson here? Get super aggressive with the pricing. The asset manager sets the price, anyway - better to price it a little low then to risk getting stuck with a listing that can turn out to be priced too high and have everyone beat you on a race to the bottom.
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