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Why are homes incorrectly priced?
Often I find sellers making the crucial mistake of incorrectly pricing their home. Usually, this is the result of poor advice from an agent, or the seller has misguided notions about starting with a high price. Drawing from my extensive experience in real estate, I can tell you first-hand that starting with too high of an asking price will derail your aspirations of getting top dollar for your home.
How do you decide the appropriate price range?
A fundamental rule of home selling revolves around the fact that most buyers in today’s market will search for homes online, and are inherently attracted to homes that are appropriately priced. So how does one determine the proper price range that is conducive to the preferences of potential buyers? With the vast majority of buyers looking for homes through online databases, homes are usually grouped within certain price range brackets. Therefore, the best strategy for sellers is to perform either a competitive or comparative market analysis, which will then help to establish the optimal price range for a seller's home.
A fundamental rule of home selling revolves around the fact that most buyers in today’s market will search for homes online, and are inherently attracted to homes that are appropriately priced. So how does one determine the proper price range that is conducive to the preferences of potential buyers? With the vast majority of buyers looking for homes through online databases, homes are usually grouped within certain price range brackets. Therefore, the best strategy for sellers is to perform either a competitive or comparative market analysis, which will then help to establish the optimal price range for a seller's home.
5 Reasons to Price Your Home Attractively
- Attract more buyers – With your home listed in the optimal price range, it allows you to garner the most attention and speculation from prospective buyers. As more buyers consider your home, the more offers you will receive, which ultimately gives you the greatest chance for getting top dollar on your home.
- If priced incorrectly, buyer activity will become stale – With a starting price that is unappealing to buyers, your home will become stagnate with little interest. Buyers will perceive your home’s prolonged time on the market as a red flag indicating potential problems or issues with the home that make it undesirable.
- Over-priced homes benefit competition – Naturally buyers will shop for homes in a comparative manner. If your home is priced wrong, buyers will gravitate towards other homes that are more ideally priced. By allowing this to happen, you have effectively helped sell someone else's home.
- Lacks velocity – Listing your home with a starting price that is above the optimal range will diminish the presence of your home on the market. Starting high and then reducing your asking price does not enhance the appeal of your home. Consequently, your home will not have any “velocity”, or noticeable impact on the attention of buyers in the market.
- Appraisals will affect the transaction - Inevitably, your home will be subject to an appraisal so that its overall value can be determined. This is important to remember because if you manage to sell your home for a higher amount than it is actually worth, the appraisal will reveal this and you will lose out on the transaction. Avoiding this situation simply demands that your home is priced at an amount that corresponds to its actual value.
In closing...
When your home is priced attractively, staged correctly, and marketed aggressively, you maximize your home’s chances of selling at top dollar. Always remember the importance of price as a determining factor for your home’s overall closing value.
When your home is priced attractively, staged correctly, and marketed aggressively, you maximize your home’s chances of selling at top dollar. Always remember the importance of price as a determining factor for your home’s overall closing value.
Once again, thank you for joining me on my video blog and stay tuned every two weeks for further updates and tips about real estate and the current market conditions in the Toronto area. Always feel free to contact me with any questions you have about your home’s value or the market.
