Pricing and Strategy
8. Pricing and Strategy
Pricing your home correctly is one of the most important decisions you will make when listing your home.It will either set you up for success and profit; or failure and loss. If you price your home too low, you may leave money on the table.If you price your home too high, only a fraction of the potential buyer pool will even look.Further, the longer it takes to find the right price, the stronger the stigma of “somethings wrong” will be. This usually results in low-ball offers because buyers perceive the seller is now desperate to dump their problems.
the proper balance of these factors will expedite the sale of your home:
1 location: it is the single greatest factor affecting value, neighborhood desirability is fundamental to a property’s fair market value
2 Competition: buyers compare your property against others for sale. they interpret value based on other homes on the market
3 timing: the real estate market shifts almost weekly and can reflect a sellers or buyer’s market. market conditions cannot be manipulated; an individually tailored marketing plan must be developed.
4 condition: property conditon affect price and speed of sale. optimizing physical appearances and advance preparation for marketing maximizes value.
5 terms: the more flexible the financing, the broader the market, quicker and higher. terms structured to meet your objectives are important to successful marketing.
6 price: if the property is not properly priced, it may delay or prevent a showing, and sale. we provide a comprehensive market study to assist you in determining the best possible price.
Let’s Price It!
Based on an in depth market analysis, there are 3 tiers of pricing.
Slightly Below Market : Create an Auction Frenzy, multiple offers, oftentimes over asking
Estimated Market Value: Typcial
Slightly High : Reaching, longer term listing
Priced correctly, homes in waco sell, on average, at 92% of list price.
Ultimately, buyers and sellers determine the value of your home based on how well it meets their needs and desires. A property value is the balance of what a buyer is willing to pay and what a seller is wiling to accept in the current market.
It is important to note that neither a Competitive nor a Comparative Market Analysis is the same as an appraisal. An appraisal can only be completed by a licensed appraiser and is a more in-depth study of your home’s worth. NextHome Our Town offers both a Competitive and a Comparative Analysis for your home, as part of the sales preparation process, up front, without charge. An appraisal may cost anywhere from $300 to over $1000 depending on your property and the availability of data.
An appraisal is a valuable tool when there are not enough similar properties to complete a solid market analysis. An appraiser takes any remotely comparable sales and uses replacement values of the differences to adjust the price up or down, finally arriving at your property’s worth.
Pyramid of Asking price vs market vlaue & Percentage of potential buyers who will look at the property
15% under market value = 90% potential buyers will look
10% under = 75%
market value = 60%
10% over/high = 30%
15% over = 10%
Activity Vs. Time on the Market
the longer a home sits on the market is relative to the price it will sell for interest level drops, means fewer showings and lower offers, if any.
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