Price Your House Correctly for the Best Result

Price Your House Correctly for the Best Result!

In an active real estate market it is vitally important that you, the seller, price your house correctly.  The real estate market has been very active for the past couple of months.  Here are three reasons why the market is so active:

1. People believe that real estate prices have hit the bottom.
2. Interest rates remain near historic lows.
3. There is a lack of inventory.

Price Your House Correctly!  One of the most important components of selling your house and achieving a desirable result is to price your house correctly.  It is very important that your house is priced appropriately from the beginning to insure a successful sale.

Typical House Pricing Strategies and their Likely Results:

Overpriced = Extra time on the market “Stale listing” = Sale at or below market value.

Price Your House Correctly = Buyer Excitement +Timely Sale = Sale at and perhaps even above market value.

Underpriced = Buyer Frenzy = Fast Sale = Sale at or very close to market value.  (Economics 101 note:  Demand will always push the final sale price to the market value in an active market.)

Your Agent’s Most Important Job:  I believe that the single most important job of your real estate professional is to help you price your house correctly and list your house at an appropriate asking price.

Once your house is priced correctly, it is important that your real estate professional market your house aggressively.  By effectively using all of the marketing strategies that are available, you can be sure that your house will receive a high level of exposure to potential buyers.  Hi exposure to buyers = increased demand = successful sale!

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The Perils of Overpricing

Reprinted with permission from BregmanProperties.com

IMPORTANT:

Some real estate “professionals” will overstate the likely sale price of your property in order to convince you to use their services.  Example: “I will list your home for $925,000” when other homes in your neighborhood, that are in about the same condition as your home, have recently sold for around $825,000.

FACT 1: If your property is overpriced, as determined by the comps, it will not sell.

What is a “comp”?: 

A “comp” is simply an abbreviation for “comparable property”. A comp is the comparison of a property which has recently sold and which is similar in many respects to your property.

Some (but not all) of the criteria that should be considered in a comp are:

• Number of bedrooms
• Number of bathrooms
• Overall square feet of living space
• Square footage of the lot – or lot size
• Overall condition of the property
• Any unique characteristics of your property that affect its value

When your property is listed above the comps:

• Your property will not sell
• Many potential buyers will never even see your property
• Your property will sit on the market and get “stale”

What do you mean by “get stale”?

A property gets the highest concentration of attention from potential buyers when it is “Just Listed”. A property that is priced appropriately in the first three weeks that it is listed will have a higher probability of selling in a short period of time. Even after a price reduction, a property will never receive as much concentrated attention as it does when it is fresh on the market.  (This paragraph was important. – TB)

FACT 2: With all of the information that is available to the public, every buyer who looks at your property knows roughly what your property should sell for.

Buyers do research: The last time you shopped for a used car, did you know roughly what the car you were interested in buying should sell for? Of course you did. You looked at what similar used cars have sold for in resources like the “Kelly Blue Book”. The comps are to houses what the Kelly Blue Book is to cars.

Summary:

Price your house correctly.  When you list your home for sale, be sure that you see and understand the comps for your neighborhood.  Remember, buyers know roughly what your house should sell for (so should you).  Price your house correctly from the beginning and chances are that you will have a timely sale at the highest possible price.

Are You a Buyer?  There is an old stock market saying that applies nicely to the current real estate market.  “It is better to catch a knife that has bounced off of the sidewalk than it is to catch a knife that has been dropped from the top of a building”.  In other words, it is better to buy once you know that the bottom of the market has been reached.  Now is the time to buy!

At Bregman Properties, whether you are buying OR selling, we will do whatever is necessary to make your real estate transaction a success!

Bregman Properties is your neighborhood specialist.  We are available to answer your questions, to provide advice and to negotiate your real estate transaction with your best interest as our primary focus.  We are always ready to provide you with outstanding representation for all of your real estate related needs.  ”Experience the Difference“