Pricing Your Home
Pricing your home is both an art and a science. Achieving the optimal price is the result of both objective research into comparable properties and a gut feeling about your property and the current market.
RELATED ARTICLE: Five Signs that Your Home is Overpriced
There is no absolute science when it comes to pricing a home. Every home is unique, and each and every point of your home must be considered in establishing an exact price. Consideration must also be given for items such as commutes and distances to schools, retail areas, etc.
It is important to be aware of the condition of your existing market, remembering that Market Value may not reflect replacement cost or even appraised value. Current listings, pending transactions, and recent sales within your geographical area must be analyzed to determine the right price for your home. A detailed inspection of the property must be completed as well, allowing an agent to develop a target market for your home that, together with the right price, will generate the optimal number of prospects.
We will communicate with you throughout the time your home is on the market, to help you understand what is happening with the market so that you can make the decisions that will help you realize your real estate goals as quickly as possible.
Although we will do everything we can to sell your home quickly, at the best price, and with no hassles, the one thing we cannot control or change is the market. Even though we know how valuable your home is, the value of your home from a selling standpoint will be determined solely by the buyers. Therefore, we have generated the following “Rules of Thumbs” to help give you better knowledge of whether or not your home is priced correctly.
If you are getting showings but no one is writing an offer, it generally means that you are in the range of four to six percent above market price.
If your number of showings is low and you’re experiencing a lot of drive-ups but the buyers don’t come in to see the home, then your home is between six and twelve percent overpriced.
If no showings are happening at all, then your house is likely priced twelve percent or more above what the market will bear for your property. Remember overpricing will:
- Help your competition sell their homes.
- Reduce sales-associate activity.
- Reduce advertising response.
- Sends interested buyers to other properties.
- Attract the wrong prospects.
- Eliminate offers.
- Potentially cause appraisal problems.
- Extend market time.
- Allow the Home to become shopworn.
- Cut down on agent showings
- Encourage Buyers to assume there is something wrong with it, or it would have already sold.
- Encourage lower offers.
- Buyer will assume your home is out of their price range and will not look at it.
Things to Remember
1. Serious buyers look in the price range determined by their down payment and monthly payment ability. Unless your property is priced correctly, the down payment and monthly payment requirements will not be competitive.
2. A buyer who is seriously looking will soon become very knowledgeable in his or her price range. An unreasonable asking price only discourages the buyer from looking at and considering your property.
3. Buyers purchase by comparison and a property that is priced above the competition does not compare favorably. Inviting a buyer to make an offer can indicate that a fair price has not been established.
4. If you plan to adjust your price at the time of sale, it is better to adjust the price now and attract serious buyers from the beginning. This often places you in the favorable position of having more than one buyer interested in your property.
PRICE IT RIGHT THE FIRST TIME AND YOU CAN GET ON WITH YOUR LIFE!