What's your worth?
I love paying attention to real estate. Like all markets – job market, stock market, etc., – housing markets move in waves, up and down and cycling over time. And housing markets have nuances that drive costs from one block to the next.
Get on the right side of understanding these micro differences and you too can win in real estate: guess wrong and watch your capital slip away.
Early this summer – agents will know this is just past the peak time for sales by the way – a neighbor put their home on the market for twice the average in our area. Mind you, this is an average home. Perhaps with some extraordinary fixtures or features it could have justified a slight uptick. But 2x?
Its a 325 home with a 650 price tag.
What happened next was predictable. Within weeks – after the initial onslaught of motivated (qualified!) buyers flushed through the system with a pass – the price dropped about $30k.
A month later and the price dropped again to the high 500's. With a new agent.
Two months more and it became “for sale by owner” with a mid 500 price.
And now, a month later yet again, the home is no longer for sale. The owners, having moved somewhere else and tiring no doubt of paying two mortgages, have the home for rent. And yes, the asking rent is too high.
In a market where the average sale time is 14 days, this home has been on the market (and is now off) for over four months. Mind you, its a gorgeous home in a beautiful neighborhood.
But the price was all wrong.
The similarities between marketing our homes and marketing our careers are profound. Sometimes in consulting with those in career transition I've found part of the reason they've gotten sideways in career is their inability to truly assess their market value to employers.
They're out of sync.
By all means never work for less than you're worth, but keep in mind if you convince an employer you're worth a significant salary package they, in turn, will expect you to deliver at that level. Certainly with the requisite skills, education and experience you can do so and you should enjoy the fruits of your labor.
But are you asking for more than your skills are worth?
The value of our compensation includes benefits and intangibles such as time off and culture: sometimes we forget the true worth of our total comp. But employers don't.
Remember, employers pay to have responsibilities met not potential unrealized. Asking 650 in a 325 market will make you an outlier in an unenviable way. In a world where 90% of us believe we're above average misunderstanding our relative worth is not uncommon but it is unhealthy.
Pricing yourself appropriately in a labor market has as much to do with understanding that market, with all its attendant supply and demand constraints, as it does with understanding your personal KSAs.
Don't become a rental property.
Maintain your knowledge.
Update your skills.
Know your market.
And you too will be moved in days not months.