The Importance of Intelligent Home Pricing for Resale:
The best chance for selling your property is within the first seven weeks. Studies show that the longer a property stays on the market, the less the seller will net.
It is very important to price your property at a competitive market value at the signing of the listing agreement. The market is so competitive that even overpricing by a few thousand dollars could mean your house will not sell. Interestingly, your first offer is usually your best offer. You want to obtain the highest amount of money in the shortest length of time!
As the triangle graph illustrates, more buyers purchase their properties at market value than above market value. If you price your property at market value, you are exposing it to a much greater percentage of prospective buyers and you are increasing your opportunity for a sale.
Timing is extremely important in the real estate market. A property attracts the most attention, excitement and interest from the real estate community and potential buyers when it is first listed. In the first few weeks your home commands the attention of all the buyers looking for your type of property. After that only the new buyers will trickle in to look. Therefore, it has the highest chance of a sale when it is new on the market. This graph illustrates the importance of placing your property on the market at a realistic price and terms from the very beginning.
Don’t set the price of your home too high; thinking you can reduce it later. As indicated by the chart above, interest peaks when your home is new on the market.
Facts That Don’t Affect the Value of Your Property:
The value of your property is determined by what a BUYER is willing to pay in today’s market based on comparing your property to others SOLD in your area.
Buyer’s Always determine value!
How to Price Your Home:
A home’s asking price should be set by comparing it with competing houses currently on the market, not sold properties; unless the market is very stable. Homes will always be overpriced in a depreciating market and underpriced in an appreciating market if you price using sold properties as an indicator. It’s critical to price your home to compete, not help sell the competition. When a property sits on the market too long it is perceived as a stale listing and buyers assume that something is wrong with the home or the neighborhood.
Think about a clothing rack where size 38 men’s jackets are placed with the size 44’s. People who need and want size 38 will miss them all together because they are not in the right spot. Overpriced homes usually end up selling below market value because they are simply missed by buyers who assume they are not in the price range that fits their budget. Buyers who qualify for the higher price will be stacking them against homes that have more value.
Many agents, eager to capture a listing, will put a house on the market for more than they know it will sell for. After a couple weeks when the seller realizes that his property is attracting very few, if any, potential buyers, he agrees to lower the price. By that time, he has lost his best opportunity to sell. The greatest influx of potential buyers view the home in the first few weeks and statistics show that the longer a home sits on the market, the lower offers it will receive.
How to Sell Your Home at the Highest Possible Price:
- Avoid Distress Selling: When a quick sale is your only option, having a strategic game plan in place is crucial. Research the market and work hand in hand with a knowledgeable real estate professional to ensure that you don’t appear desperate and make yourself a target for low bidders.
- Do not overvalue your home: Because you are emotionally invested in your home, it may be difficult to be objective when it comes to pricing it. Your realtor, a neutral third party can more accurately access your homes value, point out flaws and areas that need improvement and come up with a fair market price.
- Do not limit Home Showings: Buyers want to view homes at their own convenience. Have your house in showcase condition at all times, keep a lock box on the door and be ready to leave at a moments notice. The buyers you turn away may be the one that was going to make an offer.
- Restrain Emotional Reactions: Don’t allow a few hundred dollars to ruin a sale. Take a look at the big picture and remember; it’s a business decision, not an emotional one.
- Make cosmetic improvements: Prospects make up their minds within the first few seconds of walking in the door. First impressions are vital. Spending 1,200 on new carpet might add $4,000 to the value of your home. A real estate professional can provide you with a list of items that will maximize the profit of your home sale.
- Disclose Property Flaws: Property disclosure laws require sellers to list any flaws required by your state. If you are unaware of flaws or attempt to cover them up, you risk losing the sale and finding yourself in court. Your agent can introduce you to qualified inspectors and ensure the smooth sale of your home.
- Don’t try to sell it yourself: Most homeowners who decide to sell their own home do so because they believe they can save the commission paid to the real estate agent. Studies show that without the knowledge and negotiation skills of a professional, FSBO homes almost always sell for less. The enormous amount of time and effort required to sell a home often surprises the “For Sale By Owner (FSBO).” Many costly mistakes can be avoided with the professional guidance of a Realtor.
- Trust Your Agent: Would you tell a physician that you’ve decided to run your own tests and diagnosis your own illness? Though not life threatening, trying to sell a house on your own or ignoring the advice of a qualified Realtor can be financially devastating. Your realtors job is to protect your best interests, so view yourself as part of his team to make your home sale as profitable as possible.
- Price the Home Correctly: The main reason homes do not sell in their first listing period is overpricing. Conversely when they sell too quickly it’s usually because of under pricing. A professional agent knows the market and will evaluate the value of your home based on fact, not gut instinct or conventional wisdom.
- Choose a Realtor Based on Experience and Track Record: Home sellers often pick a realtor based on personal relationship rather than qualification and success rate. Your home may be your greatest financial asset so make sure you choose a professional to handle the sale that will insure all the important issues from pricing and marketing to negotiating the sale are handled with expertise. A top producer knows the market well and can generate many potential buyers for your property.
If you are considering selling your home in the next 6 months, you should request a FREE, NO OBLIGATION Market Analysis. This will include a detailed market analysis and a 21-point marketability test to help you determine the value of your house and estimate how long it will take to sell.
TO RECEIVE A FREE, NO OBLIGATION REPORT…