Right pricing is the heart of selling a property. It incorporates an element of art and science. The art is interpreting market trends, lending environments and target markets. The science analyzes sold data, currently listed properties, interest rate changes and local conditions, for example, increased hiring and company relocations, etc.
We will review and discuss the CMA (comparative market analysis), a report comparing similar properties that have recently sold homes, preferably within the last 6 months. This report will help determine an appropriate list price. It is essential that a property be listed at market value because the highest interest is generated within the first 14 days of a new listing. Over-pricing will result in a property staying on the market for an extended time.
Pitfalls of over-pricing
- You will experience limited showings
- The right buyer will not consider a price beyond their budget
- You will attract the wrong buyer by misrepresenting market expectations. This occurs when a buyer presumes to find certain features and amenities in a house of a particular age, type and price range.
- Listing becomes stale from sitting on the market for an extended time, creating suspicion for agents and buyers that something is wrong with the property.
- Increased time on the market will attract lower offers
- Every price reduction can weaken your negotiation leverage
- Seller(s) become frustrated with having to keep their home show-ready
- An over-priced listing will help sell other homes