Q: Eight years ago, I built our dream house. It has 5,900 square feet, an indoor pool, great view, and lots of granite countertops.
The problem is, my wife and I are divorcing and will separate in June when our daughter graduates from school. We owe $250,000 on the property, and I can’t afford to pay for the house with only my income.
Although we feel the house is worth $750,000, we put it on the market for $675,000 and recently lowered the price to $575,000. But the house isn’t selling. What can we do to avoid losing it in an auction?
A: I’m sorry that you and your wife have not been able to work things out. Your house is worth a lot of money and you have a lot of equity built into it. Obviously, your wife wants her share of this asset and you and she need to discuss how you’re going to handle it.
Unfortunately, the house doesn’t appear to be worth what you think it is worth. If it were really worth $750,000, it would have sold when you first listed it. You’ve dropped the price by $200,000 and the property still hasn’t sold.
It’s time to think about why your house isn’t selling. Have you built a house that’s too nice for the surrounding neighborhood? Is there a perception out there that you and your wife will give this house away for nothing? Is the indoor pool a liability? Would you be better off filling in the pool and creating a different use for that room? Does the house need some work inside or some additional landscaping to bring it up to where you could get $750,000?
You should also talk to your agent about what she’s hearing from people who have seen the property. Buyers are perceptive and it’s possible that they’ve picked up on a possible problem with the property that you’ve missed. Getting some feedback from buyers who have recently gone through the property might help.
Finally, consider withdrawing the property from the market for a short period of time to freshen it up and think about finding a more aggressive agent who will actively market your property.
You should aim to put your property back on the market in February, when the housing activity swings into high gear for the Spring selling season.
Good luck.
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