Pricing Your Home Right!

My clients often want to price their homes above expected selling price because they want to leave room to negotiate or “wiggle room" as some call it.

What they don’t know is that leaving “wiggle room” can cause them to be priced above their market, reducing or even preventing showings causing their house not to be shown and not to sell. 

Fairfield County market activity is improving but inventory still exceeds normal levels and buyers remain concerned about the possibility of a double dip drop in real estate values.  Buyers don’t want to over pay and are being very cautious. 

Lenders are also extremely guarded.  Not only does the buyer have to be exceedingly qualified to gain mortgage approval but appraisers are also being very conservative in their calculations.  Fair selling prices must be well substantiated.  If a seller finds a buyer who is willing to overpay, the property is not likely to appraise satisfactorily for their lender!  Buyers paying cash will probably order an appraisal and even cash buyers are not likely to pay more than appraised value.

There are plenty of houses to show.  Agents will show the houses that are fairly priced, first.  If your house isn’t among them, you might just miss buyers all together.  In this market, the houses far outnumber the buyers, so no seller should miss a chance to get their house shown and sold.

Lastly, if your house is overpriced, a buyer who is searching in that price range will see other houses that offer them more.  The other houses will be larger, newer, have more land, be in better condition, have more amenities, be in more desirable locations, have better layouts and flow, have more land etc.  They will buy the other houses where they get more desired features.  Wouldn’t you?

Pricing right works! I just reviewed all properties, sold in 4 local towns since January 1, 2011.  Of the 510 sold properties, 76 of them or 15% sold at or above the List Price and they sold in half the time of the others.  If you’ve ever had your house on the market, you can certainly appreciate getting market value with only half the inconvenience of showing your house.  That is a major victory! The properties that sold at or above list price are below.

If your home is priced right, buyers will pay your price.  If not, you can always refuse their offer and wait for the possibility of another offer.  But, be careful when refusing offers.  Be certain that you can document the value before refusing offers.  The research does show that first offers are often higher than offers that might follow.

Barbara Corcoran, the NBC real estate expert insists that pricing is a war and your price has to be lethal for you to win the war and sell your house. 

 

Fifteen Percent of Homes Sold at or above list price: