|Price - Condition - Location |
Mistakes that Sellers Make on Pricing
There is a huge amount of competition from distressed properties in today's market. The "normal" seller has a difficult time getting their properties sold. It is absolutely critical that you price your property right.
Setting the best possible price for your home can be challenging. If you overprice your property, it can stay on the market for months and become "stale". Buyers and their agents begin to wonder why it has not sold.
Do not set the list price for your home based on the list price of other properties in your neighborhood.
The ONLY comparable sales are those that have closed. The buyers determine the market value of real estate and these are the homes they felt were priced right for the condition and location. Another huge factor is these are the homes that have passed the lenders appraisal process. While properties may be selling, many are not closing due to the credit crunch and new appraisal regulations. Appraisals are now a huge issue.
Do not base your list price on what you paid or "have into" the property.
Many sellers believe that what they paid for the property influences their current sales price. They say we have to sell at X amount to break even. Many people believe the sellers and real estate agents determine the price that a property will sell at.
The truth is that the real estate market is like the stock market. The buyers determine whether a property is saleable at any given point. If you paid $60 for Walmart stock and today it's selling for $50 a share, if you wanted to sell it at $60 a share, you would not be a seller in today's market. The price you paid for the property has NO bearing on what the buyer will pay.
How much are your improvements worth?
Many sellers have a difficulty understanding how the improvements or upgrades that they make to the property impacts value. Some improvements do increase value. Generally these include bringing your home up to the same quality as most of the other properties in the area or adding square footage. Most improvements, however, make your property more saleable, but they don't necessarily add to the value. The appraiser is not going to adjust the appraisal up $1000's of dollars because you installed new carpet last year or replaced the roof. These features make your home more attractive to potential buyers, but don't necessarily add to the value.
Don't test the market with a high price
I often have sellers say they want to list their home at a higher price for a few weeks and see what happens. The first 30 days on the market is when you will get the most showings. The reason is that buyers who have not yet found a property, attempt to see new listings as they come on the market. After that initial activity, showings are normally limited to new buyers coming into the market. You can generate additional interest with a price reduction, but it never creates the attention you receive when you first list the property.
Together, we will determine the best possible price, based on cold, hard facts. I will make sure you have the data, to make an informed decision on the current value of your home.