Sellers : Pricing Your Home
Proper pricing is absolutely essential in creating the best possible climate in which to sell your home, as it attracts the greatest number of potential buyers and increases the possibility of a quick sale and a multiple offer situation. The results of overpricing or underpricing can be similarly devastating in different ways. Some sellers feel that if they list their property high and reduce gradually that they are more likely to sell for the highest amount possible; this is false. If the property is overpriced, the listing experiences little activity as it is likely to sit on the market for a long time. Qualified buyers who are looking in the range of what the property should sell for never see the listing as it falls outside their search criteria. Feedback from the few showings that do happen will often be negative, as a potential buyer at an unrealistic price point will have the expectation of a better house for the price. By the time the listing is reduced into a more accurate range and becomes visible to a viable buyer, it has been on the market a long time and buyer often assumes that there is something wrong with the house, or tries to low-ball an offer. The property often sells for less than it would have had it been properly priced, and after a much longer time.
Underpricing a home with the expectation of a highly competitive multiple offer situation can also have a detrimental effect on the final result. When a home is listed drastically under fair market value, it exposes the property to a market of buyers that cannot afford to pay what a seller is truly looking to sell for; you are relying on the hope that a buyer with much more to spend is shopping well below their budget and is willing to spend dramatically over list price to purchase the house. While the market will sometimes create this situation, the strong possibility exists that while you may receive multiple offers none will be acceptable to you. If the home does not sell on the designated offer night, it is highly unlikely that a multiple offer situation – and often any offer – can be solicited at a later date at a higher price. Like homes that have been overpriced, the property often ends up selling for less than it should have and after a much longer time on the market than comparable properties.
First and foremost, it is important to recognize and acknowledge the fact that it is not the homeowner or the Realtor that sets the market value for a property, it is set by the market itself through a combination of comparable sold listings, availability of comparable listings, and overall economic conditions. Determining an accurate list price is the key to arriving at the best possible sale price. The list price must capture the true value of your home while encouraging a multiple offer situation; it is a delicate process that requires extensive, up to the minute market knowledge and a great deal of experience. From there, a professional, carefully timed marketing plan promotes the listing and carefully-handled offer negotiation strategies are implemented to encourage the best possible result for you.
For most people, the sale of a house is one the largest financial transactions that they will ever enter into. Don’t choose a Realtor who offers to list the property for the highest price. Choose the one who knows the market and can substantiate their opinion of value, offers advice and insight into proper pricing, can offer you the most extensive marketing plan, and has proven skill in high-stakes negotiations.