This is a well-known idiom, but it is sometimes left by the wayside when sellers are negotiating offers on their homes.  Thankfully, I don't typically have clients who ignore this concept, but in the last week I have heard of three sellers who need(ed) to take this to heart.  The details below have been fudged a bit to prevent you from determining which properties I'm referencing..

Scenario One:
The owners of a townhouse arguably worth $170k let contract negotiations fail at $172k.  Wait.....what??  They won't accept more than what it's worth??  I suppose this one is a bit subjective, but basically, we'll imagine that they have their townhouse listed around $180k, and have negotiated down to $172k, but won't go a penny lower.  The issue is, of course, that the buyer, the buyer's Realtor, and several other Realtors all concur that it would be optimistic to assume that the townhouse is even worth $170k.   So here, the homeowner's "sense" of the value of their home is preventing them from moving forward with an excellent offer in hand.

Scenario Two:
This townhouse has been on the market for roughly a year, and has been reduced in price by tens of thousands of dollars.  The owner has actually had quite a few birds in hand, as there have been multiple offers on this property over the months.  Here's what happens --- an offer comes in that is around $7k less than the asking price, the seller rejects it, a month or so passes, the seller lowers the price $10k, an offer comes in around $7k less than the asking price, the seller rejects it, a month or so passes, the seller lowers the price $10k, etc., etc., etc.  Bird after bird in hand, and then flying away!

Scenario Three:
I met some homeowners today who made an offer about a year ago on a new construction duplex.  Their offer was deemed to be too low by the builder, and thus rejected.  Now, a year later, the duplex is still available for sale, and the asking price is now just a hair lower than these homeowners' offer on the property a year ago.  With a (rounded) price of $230k, assuming the builder might have been carrying $150k of a construction loan on the property, at perhaps 6%, that decision has likely cost the builder $9,000 in interest over the past year. 

It is certainly reasonable to strive for the best possible price for your property if you are selling it, but you must carefully weigh the value of a bird (offer) in hand relative to the prospect of waiting (and waiting, and waiting) for the next offer to come along.

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Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com