Think you know the ins and
outs of home pricing? It’s more complex than you might imagine.
Get a quick
education on home pricing with this blog post on tough pricing truths.
The pricing conversation is always a challenge.
You want top dollar for your home, and your real estate agent will, too. After
all, a better commission comes from a better price.
But a lot of psychology and
strategy goes into home pricing, and if you don’t go in with your eyes wide
open, you could end up heartily disappointed.
Here are some tough truths about home pricing.
While they can vary a little depending on unique market conditions, they should
all be in the back of your mind as you prepare to list.
1. Some agents will try and “buy the listing.” Sad but true: Some agents will tell
you what you want for the home is accurate, even if it’s too high. Figuring they
can manage disappointment and reductions down the line, the less-than-ethical
agent will try and cut off the more honest competition by telling you the price
you think you should get for the listing is the price you should shoot for.
2. Nobody cares what you paid for the home. No buyer in the history of real
estate has ever agreed to pay more for a home because of the profit a a seller
hopes to get. Yes, you may have sunk $150,000 in renovations into the basement,
but the market will dictate the pricing, not what you “think is right.”
3. Lowball pricing is risky. Yes, you can generate a lot of
interest by undercutting other listings on the market, but people may still
attempt to negotiate. While you may stay firm on your price, you could find
yourself making contract compromises you’d rather not make.
4. Precise pricing suggests you’re less willing to
negotiate. List a
home for $403,750 versus $400,000 and you’re basically broadcasting a kind of
inflexibility. This may or may not be part of your pricing strategy, but
whatever you do, don’t do it unconsciously.
5. Seasonal timing can influence pricing. Are you the only comparable home on
the market in January? You might be able to get a little more, especially if
schools are good.
6. Infomercial pricing can make a difference. Have a million dollar home? Swallow
your pride and try your hand in the $990K+ range. Slipping under the
seven-figure mark can cast a slightly wider net for buyers.
Most homes sell within 3% of a market-savvy asking price, so go with an
agent who is willing to explore the deep local conditions. Curious how much
your home might be worth right now? I’d be happy to put together a
no-obligation pricing matrix for you: valeriemcconville@realtyexecutives.com
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