I’d like to discuss what is arguably the most important thing to consider when selling a home. Any guesses? Although things like staging, timing, and marketing all come to mind (and certainly should not be discounted), what I’m talking about is price. Sometimes just a few thousand dollars can mean the difference between selling quickly and not selling at all!
Your objective should almost always be to achieve the best price, in the shortest time, with the most favorable terms and conditions. You can achieve this by pricing at almost precisely what potential buyers would be willing to pay for your home – easier said than done. Pricing a property is somewhat of a science, including complex calculations that involve figures associated with recent sale prices of comparable homes, supply and demand, socio-political influences, timing, and unique monetary aspects of the structure or land. Taking all of this into consideration can be overwhelming, but worth the effort. It’s no surprise that people such as appraisers, lenders and Realtors alike base their careers on various aspects of this process.
That said, after going through this effort, let’s say we know your home is genuinely worth about $140,000, give or take $5,000. It is tempting to list at a higher price, say $169,000, to see if maybe, just maybe, someone out there will fall in love with the home instantly (and won’t care about the price). This is a practice I like to call “fishing” – yes, it works sometimes, but rarely. I don’t have to tell you that buyers in today’s economy will not pay more for something than they have to. If your neighbor around the corner is selling a home that has compatible features and priced properly, he is much more likely to receive offers. By pricing higher than what’s fair, you have in fact made his property look like a better deal. Now I’m a neighborly guy and all, but I wouldn’t do a favor that big for my buddy next door (sorry Josh!). In addition, consider this caveat: buyers may refuse to even consider your property because it is out of their financial reach. Not a good situation, especially if you need to sell quickly.
My recommendation should be obvious by this point. Price your property at what it’s truly worth. Buyers will take you seriously and won’t feel like they’re getting ripped off, which will make for a more amicable and stress-free negotiation process. I guess that’s the Golden Rule at work, right?