How to price your house in today’s market…
April 29th, 2009 categories: Coconut Grove Real Estate
The other day I went to talk to a potential seller about listing their home. It was so refreshing to speak with someone who is realistic about the value of their home. There was none of the usual… “I have to get ”x” amount out of the house”, or “But I paid “x” amount for it” or “I can’t afford to sell it for less than “x”.
We as Realtors hear these comments all the time from sellers and it never ceases to amaze me that they don’t realize their needs have absolutely nothing to do with the value of their home. The value is solely determined by what a buyer is willing to pay. It is also determined nowadays by what an appraiser says the home’s value is worth.
Now that I got that off my chest, it is my opinion that in today’s market you need to price your house ahead of the market. So often we see sellers come in with unrealistic asking prices and they have to constantly reduce reduce reduce as they chase the market down. What I mean by “pricing your home ahead of the market” is that you should anticipate that prices are falling and price your house accordingly, as opposed to reacting to a falling market. It is always better to act than react.
Price it so that it is attractive to as many buyers as possible and don’t worry about low ball offers coming in. Most sellers right now believe that they have to price the house higher to combat low ball offers. But what I have been seeing is that once sellers reduce the house to what is a realistic range, they sell for much closer to their asking price. Once a house is priced attractively buyers fear that somebody else will come in and make a higher offer.
The key question right now for buyers is where can they get the most value. Remember that value is determined by what a buyer will pay, not what a seller needs.
Thanks, Riley. My favorite pricing is when the asking price is raised shortly after the property goes on the market because the offers coming in were “too low.” When a seller insists upon receiving a certain amount regardless of how a home appraises–and insists that be in the contract–that’s interesting, too. Kind of makes you want to flee.
Linda