You must be aware that many listing agents are not aware of how the internet works. Keep this in mind as you solicit the ideas of agents as to what your home or condo should be priced at so that it gathers the most amount of buyers. You can witness this for yourself by going to public websites where listings are posted like www.Realtor.com and view the house prices after you read this article.
And, more dangerous for a homeowner is that most agents still use the comparables sold in the area, they don’t add for appreciation and they price on the dreaded 900’s strategy. You have seen it $249,900, right?
The danger of the 900’s strategy is that when buyers search the internet and use the pull-down menus of any of the websites that post agent listings like www.Realtor.com, are finding a home priced at $249,900 in the $200K to $250K price range, however they are missing the seller’s home when they look from $250K to $300K. Didn’t the seller really mean to price their home at $250K?
The other place that the seller misses buyers is when agents manually search for a buyer client. Let’s say the buyer is looking up to $300K and the agent decides to search $250K to $300K. Most agents will not think to look from $249,900 to $300,000. They type in $250000 to $300000, never thinking that they have missed a whole bunch of houses listed with the dreaded $249,900 strategy.
Big round numbers in increments of 5,000 is the most powerful approach to getting the most amount of buyers in your price range. Avoid pricing with anything less because agents search in increments of 5,000. If you are in the middle of the price range, you are not going to get as many buyers. I know that you may be thinking that you want to beat your neighbor by $1,000 or $2,000 of your asking price, but it doesn’t work that way. Even if you said my neighbor and I have the exact same floorplan, you and your neighbor have different properties. Your land is different, your location in the neighborhood is different and the things that you have done in the home are different. It is very rare that a buyer likes two homes the same. They always have a first choice and a second choice. Buyers negotiate on the home that they like the best first. If the terms are acceptable to them, they buy that home.
So, as you look further at how to price your home, looking at comparable listings are important. However, you must remember that the houses that have sold will not be compared to yours by a buyer who is searching. The buyer can not view those homes. Also, remember to add appreciation to those homes that sold in months previous. We add it by the month and you should too.
One other point that is valuable. Once you are on the market and before you lower your price, consider other options like offering more commission to a buyer’s agent or staging your home. Invest the money that you were going to lower your home to back into your home to improve the vibe that you are sending to the potential buyers via pictures on the internet or with in-person visits.