A second look at overpriced property in Tenerife

If a property doesn’t sell then there must be something wrong with it.  That statement is always true.  But whereas most buyers are suspicious of a home that has been on the market for some time, worried that there may be problems in location or condition, in fact the most common problem is that the price is simply too high.  Homes that are over priced will often not sell at all, simply because buyers don’t make offers on them.

The first problem with an overpriced home is that it just doesn’t enter into a buyer’s radar.  Because they have a budget, they will often not even consider property that comes above that budget, let alone view it. But even if they do happen to see an overpriced property listed amongst the many that they may have selected, it goes against human nature to offer substantially less than the asking price to a seller. It's insulting to the seller and embarrassing for the buyer. 

There are also many false assumptions that buyers make, which deter them from enquiring about an over priced property.  Buyers are generally under the impression that the seller knows that their home is overpriced, but surprisingly this is often not the case.  They believe that if a seller would be willing to sell for less, the seller would simply lower their price: and this is certainly not the case.  Finally, buyers assume that the seller must already have turned down low offers from other buyers, because surely someone must have offered a reasonable price to the seller.  Wrong again.  In many cases, there has never been an offer at all, and in some there has never even been a viewing!

As you start to see through these assumptions, it becomes clear that there may be some great deals to be had by looking at properties that are overpriced and have been on the market for some time.  You may be the first to view that home for months, and the only one who has ever been serious enough to put in an offer, albeit a low one.  A good estate agent will be of immeasurable help in this.

A very good example of all this is a sale that is being processed right now.  We can’t mention any names because the sale has not completed, but the details are accurate. 

A home sat on the market for 12 months at an asking price of €800,000, and in that time the market has softened and the owners moved away from Tenerife.  Because the vendors had moved, they were highly motivated to make the sale.  The buyers, with the help of their sales advisor at Tenerife Property Shop, put together an offer pointing out the changes in the market and prices that recent sales of similar properties had achieved.  They agreed on a price which was some €200,000 below the original asking price and a private contract was signed two weeks ago.

So the moral of the story is quite simple.  If you are really serious about looking for a bargain in Tenerife it can often be a good idea to look where most others do not.  Contact your sales advisor and take a look at some of the more ambitiously priced properties.  Find out how long they have been on the market.  Don't just pass them by. You could be passing up an opportunity to buy your dream home.