One of the most critical factors in selling a home quickly and for a good final sale price is choosing the right list price. There are several different approaches you can take to determine the right price for your property. Which one you choose depends on what strategy you want to use to attract buyers, and also how much risk you’re prepared to take in order to attract offers.
Many homeowners simply want to list their property at the highest price they believe the market can bear. They’ve seen what a few properties are selling for in their neighbourhood and then add an arbitrary percentage to reflect where they think the market will be by the time they sell in a month or two. This rather optimistic approach is favoured by sellers who want to ‘test the waters’ to see just how high the market might go. They think they can try the high end price first and adjust it downwards later if they don’t get results. As any Coldwell Banker ® professional can tell you, this strategy can be a costly mistake. Overpricing your listing can have several potentially damaging repercussions. Salespeople will be less likely to recommend it to potential buyers, so you’ll get fewer viewings. They may pass it by in favour of other, more competitively priced listings, and in very little time, they’ll simply forget about it. Fewer viewers means fewer opportunities for your sales professional to convert those prospects into buyers.
Trying to solve the problem with later reductions in the list price simply doesn’t have the same impact as pricing it right the first time. In fact, sometimes the opposite is true. Going through price reductions means your house is on the market for a longer time. And the longer it’s on the market, the more suspicious buyers become that something must be wrong. It’s human nature. This means you may have to lower your price even further to get action.
The ideal strategy to stimulate buyer interest is to set your initial price either at, or even slightly below market. In fact, in a very high demand area, it may even be preferable to list the most sought-after properties at an under-market price. This is done to encourage the seller’s dream scenario – the multiple-offer bidding war.
How do you know what approach is right for you and your property? This is where the experienced Coldwell Banker sales professional proves their value. Your Coldwell Banker salesperson can prepare a comprehensive market analysis to help you arrive at the right list price. Not only will this report show you what comparable homes in the area recently sold for, it will also show you current listings now on the market. This is your direct competition – the properties you’re competing against for buyers, so choose your price accordingly. And remember to look closely at those expired listings. This shows you what prices the market will not bear.