Selling Real Estate: Pricing Strategy
Pricing Your Property is a Balancing Act
On the one hand, you want to set a listing price that maximizes interest among qualified, motivated buyers who will be willing to pay top dollar for your property. Indeed, such buyers will ultimately determine your property's top market value.
On the other hand, you do not want to set a listing price that attracts a lot of buyer prospects, but sets the stage for negotiations that result in you getting less than what your property is really worth.
Your Home's Actual Market Value
In a perfect world, your home's value would be everything you think and need it to be. However, simply put, your home's value is not determined by you, but by what the market is willing to pay for it at a given time. These days, the "market" increasingly refers to home buyers who have researched property values over the Internet for months, have already viewed a number of homes, and are not under any undue pressure to buy.
You can determine a value range for your home by looking at the recent sale prices and current asking prices of homes similar to yours in your area. That is why I am preparing a Comparative Market Analysis (CMA) that includes a variety of "comparable" homes drawn from the local Multiple Listing Service® (MLS®).
The Bottom Line
On average, serious buyers look at about fifteen properties before they make an offer. Doing so gives them a basis for determining how competitively a property is priced, both in terms of the market generally and what they are looking for specifically.
If you overprice your property you'll usually lose serious buyers even if they otherwise love it. Experience shows that buyers usually do not make what they consider to be realistic offers on overpriced properties because they assume that doing so will just be a waste of time.
Besides being realistic, the correct sale also largely depends on current market activity and your desired time on the market. For further information including the pricing pyramid and details about the consequences of overpricing please request our free seller information package.