Just realized that 'just list it for what you paid' advice is terrible here in Austin

My buddy told me to price my flip at what I bought it for plus 10k, thinking it would sell fast. Ngl, after 3 months on market and four price drops, I learned comps and market timing matter way more than that simple formula. Anyone else get burned by well meaning but bad pricing advice?

3 comments

3 Comments

jamiesullivan4d ago

Comps showing dry traffic by week 2 or 3 is a red flag you can't ignore. If you had that data and still stuck with the buy-plus-10k formula, that's where the real issue was. Your buddy's advice probably worked fine in a hot market where everything moves fast, but Austin flipped hard lately and those simple formulas just don't hold up. Pricing based on what you paid ignores what buyers are actually willing to spend right now, which is the only number that matters. After three months on market, you probably had to drop below what a smart comp-based price would have been from the start. Learning the hard way is still learning though, just costs a lot more.

nathan_kim5d ago

Did you look at active comps before you listed, or just figure your buddy's formula would work since he's done a few deals? I'm asking because I've seen people skip the real data and rely on someone's "system" that worked during a different market, then get stuck holding a house for way too long. What were the actual comps telling you around weeks 2 or 3 when the showings started drying up?

lucashenderson5d ago

Hold up, I kinda see it different. Comps are useful but they're not some magic crystal ball, especially when the market shifts faster than anyone can keep up with. If the showings dry up after a few weeks, it might just mean the house needs better photos or a little price tweak, not that the whole formula was garbage from the start.