Pricing to Sell 210

pricingThere are five factors that control price and your ultimate selling price.

          1. Location
          2. Time you have to sell
        1. Terms you are willing to accept or offer
        2. Condition
        3. Agent you select

Your location – even within a neighborhood – makes all the difference and you cannot change it.  One of the biggest mistakes we see sellers make is if they back up to or are located on a main road and they don’t think it should affect their price.  Home builders all over the country discount lots that face these circumstances.  It only makes sense that you would pass along that savings when you go to sell.  When faced with two identical homes priced identically, we can guarantee that a buyer will choose the home that does not back up to or is on a main road every time.

Time – If you have a deadline that you have to sell, for example a new job location starts in 60 days or you have a contingent offer with a builder that expires in 45 days, you will have to be very careful about pricing your home.  Each neighborhood will have their own average days on the market.  Work with your agent to figure out how to meet your future commitment of time.  Price accordingly.

Terms – Do you need to close in 60 days instead of 30?  Do you have the need to extend possession beyond your close of escrow?  Do you want to keep the appliances?  Do you want to sell the property “as is”?  These are all examples of terms that may actually cost you dollars.

Does the buyer have a contingency such as successful closing of another home?  Does the buyer need to take possession prior to closing (not a great idea by the way)? Does the buyer need you to help with closing costs?  Does the buyer absolutely want your refrigerator when you weren’t offering it?  These are all examples of terms that if you agree to can get you a little higher price.

Condition – You have ONE chance to make a first impression.  A little elbow grease will go a long way.  We like to suggest to our sellers to take a good look at some listings on Realtor.com to see what some of the photos look like.  Compare homes that have been decluttered and has a place for everything and everything in its place.  Make your home show ready!

Look inside your cabinets and closets.  Clear them out as much as possible by storing the things that you can live without for a couple of months.  The idea here is to have a potential buyer look and think, “Wow, look at all this extra space they aren’t using.  There is plenty of storage space here for my things.”  If what they see is cabinets and closets jam packed, they are likely going to pass.

The Agent You Select – Cannot stress this enough.  Find an agent who is a great negotiator, and read our FREE reports that you will find on “Interviewing Agents 101” in our Seller University.

Dangers Of Over Pricing

  1. You will take longer to sell
  2. You will have fewer showings
  3. You will receive lower offers
  4. Your property will help sell other properties

There is a pool of buyers that will likely buy your home.  These are the buyers that are looking in your price range.  Too high in that price range they are overlapping with the buyers in the next price range up.  Too low in that price range and they are overlapping with the buyers in the next price range down.  So being in the wrong price range (high or low) could mean that the type of buyer that would buy your home, will never know it is available.

Today’s buyers are pretty savvy about pricing.  With the Internet and all the information available to buyers they have a pretty good idea about a homes true value.  Then there is also the fact that their agent is likely a “buyer agent” which means they represent the buyer and their interests.  A buyer agent will do a mini market analysis for a buyer before they write an offer so they are making informed decisions.  The third fact is that buyers get educated quickly simply by viewing homes with their agent.  They can compare for themselves amenities, condition, etc. and get a pretty good sense of whether or not a home is priced right.

Other considerations:

  • Always keep in mind that the buyer may need a mortgage and therefore an appraisal.
  • Do not make the mistake of selecting your agent based on price, but on the strength of their marketing plan. Some agents will tell you what you want to hear instead of  what you need to hear, just to get the listing.
  • Most activity in the life of a new listing occurs in the first 4 weeks.  Properly priced listings should receive an attractive offer during that time.
  • Doesn’t matter what you want to get for your home, or what you need to get for your home.  Bottom line is what price the market will bear.

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