Establishing A List Price9 May Monica Breckenridge
Houses sell quickly and usually for the most money when they are priced properly in the beginning.
Setting the proper asking price for your home is the single biggest factor that will determine the success or failure of your home sale.
The consequences of making the wrong decision are painful. If you price your home to low, you will literally give away thousands of dollars that could have been in your pocket.
Price it too high, and your home will sit for months, developing the reputation of a problem property (everyone will think that there is something wrong with it).
Failure to understand market conditions and properly price your home can cost you a bundle or cause your home not to sell…preventing you from achieving your goal.
Utilizing the latest computer technology and my in depth knowledge of the market, I will analyze current market conditions in combination with your personal time requirements to identify the correct price range for your home. You can’t afford any “Guesswork” in this critical step.
Benefits of Proper Pricing
•FASTER SALE: The property price gets a faster sale, which means you save on mortgage payments, insurance, and other carrying costs.
•LESS INCONVENIENCE: As you know, it takes a lot of time and energy to prepare your home for a showing, keep the property clean, make arrangements for children, and generally alter your lifestyle. Proper pricing shortens market time.
•INCREASED SALESPERSON RESPONSE: When salespeople are excited about a property and it’s price, they make special efforts to contact all their potential buyers and show the property whenever possible.
•EXPOSURE TO MORE PROSPECTS: Pricing at market value will open your home up to more people who can afford it.
•BETTER RESPONSE TO ADVERTISING: Buyer inquiry calls are more readily converted into showing appointments when the price is not a deterrent.
•HIGHER OFFERS: When a property is priced right, buyers are much less likely to make a low offer, for fear of losing out on a great deal.
•MORE MONEY TO SELLERS: When a property is priced right, the excitement of the market produces a higher sales price in less time. You NET more due to the higher sales price and lower carrying costs.
Dangers of Over Pricing
•Many Potential buyers won’t even look, thinking it’s out of their price range.
•Those buyers who do look are shopping by comparison, and looking at your home may convince them to make a bid on a different property.
•Since an appraisal is often required in fining a property, it’s futile to price a property for more than it’s worth.
•Often the first question buyers ask is, “how long has it been on the market?” Properties left on the market for extended periods of time usually become “shopworn” which causes many to believe something’s wrong with it.
•Overpricing tends to dampen the other salesperson’s attitude, making it less likely to be shown.
•Overpricing lengthens marketing time, and invariably results in a lower selling price than would have been otherwise obtained.
Obstacles to Proper Pricing
•Incompetent Agents who will accept a listing at any price the seller puts on it.
•Neighbors who lead the seller to believe they got more for their house than they actually did.
•Inflationary Times that cause prices to go up rapidly because of economic factors.
•Recessionary Times that cause prices to go down because of adverse economic conditions.
•The Market that causes drastic changes in supply and demand alter a home’s worth.
•Loss of Perspective due to the seller being emotionally involved and losing their objectivity. Need for a certain amount of cash has nothing to do with value no matter how important the reasons.
Pricing a home correctly is an art and includes the proper interpretation of statistical analysis and gut instinct guided by experience and market knowledge.
Pink Realty's pricing analysis includes a close examination of recent comparable home sales, pending sales, an evaluation of overall market movement and aspects of your property that impact marketability including location, demand and condition of the home. Market Knowledge: Our number one buyers team shows literally hundreds of homes to buyers from around the country and are an invaluable source of competitive feedback. We also factor in inventory levels of comparable properties and evaluate the impact of distressed properties in the area. This is supply and Demand! If there is low inventory this means less homes that buyers can choose from. Making your home more desirable and driving up the list price!
At the time you decide to list your home for sale, pricing it correctly is one of the most important factors in determining how long it will take to sell. A common mistake people make is starting with a price that is too high. People want to get the most for their home, so they price it higher than market value to ‘test’ the market. Unfortunately, pricing your home too high out of the starting gate can keep homebuyers from looking at your house; and in the end, cost you more money because the house sits on the market longer.
Unfortunately, the market value of your home is not what you owe on your home or how much you need to net from the sale. Several things must be considered to price your home for a quick sale. Sellers can be too emotionally attached to their home to objectively value and price their home on their own, so it makes sense to work with a reputable real estate agent who can help you determine the right price so it sells quickly. A reputable agent can let you know what the national real estate market is doing, as well as the Colorado Springs real estate market. They know what the demand is for housing in your specific neighborhood and what the homes there are selling for. In addition to market conditions, they know what buyers are looking for and how the condition of your home will affect a potential sale. These factors, as well as your personal motivation to sell all play an important role in a quick sale.
A large misconception among homeowners looking to sell their home is the return on their money for renovation work they might have done. If you live in a home built in the 1960′s or 1970′s and spent $20K to update and modernize your kitchen and bathrooms, it does not mean you will get all that money back when you sell your home. Because you spent $10K to finish and unfinished basement, does not mean you can add $10K to the sales price. The market value of your home will not always equal what you owe and/or what you have invested to restore and rehab your home.
Buyers tend to expect that sellers have updated their homes, but do not expect the cost of the renovations to be added to the sales price! Buyers look for ‘move-in’ ready homes unless they are specifically in the market to purchase a ‘fixer-upper’. They typically do not want to do the updating or make the expensive repairs. It is very important to understand that renovation dollars can bring your home up to market value, but they will not support a sales price over market value!
An experienced agent knows your neighborhood, the demand for home sales in that neighborhood, and can determine the best list price to sell your home quickly. I will do a Comparative Market Analysis (CMA) on houses in your neighborhood. This will include current listings and list prices, recent sales and sold prices and the number of days the sold houses were on the market. Once we determine and set the initial listing price of your home, it is essential that all the conditions that went into setting the list price are monitored and evaluated regularly. Neighborhood markets can change quickly, so I will update you on any market changes so price adjustments can be made, if necessary. Being proactive and adjusting the price as needed to meet the changing conditions, can get your home sold faster, saving you time and money.