Unusual question – Everyone knows how the stock market works.  There is a price that your stocks will sell at a certain point of the day.  The price changes from day to day and can quickly change from hour to hour.

What makes the price change?  Everyone knows the answer to that.

I recently went on a listing appointment and I told a prospect that I thought their house would sell for around $450,000.  We had it on the market a while, we finally got an offer, and our best offer is $430,000.  The seller kept saying that I told them it would sell for $450,000. 

I tried to explain to him that a lot of things had changed since I said his house would sell for $450,000.  In fact, the real estate market has really dropped and he was lucky to get $430,000.  I tried to explain to him that if he called his stock broker and said that he wanted to sell ABC company and his stock broker said it was $45/share and then two weeks later he decided to sell, he would not call his stock broker and say that he would take the $45/share.  He would ask what his stock was worth today.  The stock broker would tell him it was worth $43/share – he would not get mad at his stock broker and say that he told him it was worth $45.

That is the way the real estate market works.  There is a price that the property will sell at at a certain time and that price changes according to other listings that come on the market, the national economy, interest rates and consumer confidence.  All of these things affect the value of a property.

I told someone the other day that if their next door neighbor goes through a bad divorce and has to sell their house it effects the value of yours if you are selling yours at the same time and theirs is a similar house in a similar location at a lower price.  The buyer does not really does not care about your situation – the buyer only cares about the best buy they can get.

Let’s always remember the way the stock market works and that the real estate market basically works the same way.