Home For Sale Pricing Pitfalls
This article was written by Juliana Lee and appeared in the Times Tribune, Wednesday, December 9, 1992
When selling your home, pricing it too high leads to numerous pitfalls.
Resist the temptation of pricing too high with the intention of "testing the water".
Pricing high can do more harm than good. In this extremely competitive selling market, sellers need to attract as much attention to their property as possible. Falling prey to common misperceptions can cause serious damage to your marketing plan.
HERE ARE A FEW of the more common mistakes:
- "I'll just list my home high for a couple of weeks and then lower it if I need to."
- With this common mistake, sellers often waste their greatest opportunity.
- The first two weeks of your sale are your properties market debut. This is the time when your agent features your property at his/her weekly brokers meeting. At this point, most brokers will make an on-the-spot decision as to whether or not your property will be one out of hundreds available that they will show their clients.
- It is crucial to get the other brokers excited about the value of your home. The word of your property will travel like wildfire if the brokers see value. The objective at this stage should be to tap into the huge reservoir of buyers who have been in the market for several months and are now ready to buy.
- Bargaining room: "They can always make an offer".
- This is the philosophy that buyers will come in with a low offer, so, in order to eventually agree on a fair market-value price you must overprice by the amount that you are willing to come down during the bargaining process.
- The main problem with this approach is that an incorrect price will target the wrong buyers. As brokers search the MLS computer, your home will appear in a higher price range. This will cause your home to seem like a poor value in comparison to others in this range.
- Meanwhile, your home will be left out of a search done by good buyers in your real price range. It is likely that the very people who are in the market for your home, won't even know about it.
IN SUMMARY, the more buyers who are in interested in your home, the better position you are in as a seller.
The way to create this interest is to capitalize on the first two weeks of opportunity with a sane and reasonable pricing strategy that will get the other brokers talking. I have often seen interest from several buyers turn into a competitive bidding situation in which the seller sold above market value. This approach puts you in the driver seat.
Remember, you don't have to accept any offers that you don't like!