Properly priced, any property will sell in any market. But how can home sellers figure out what the proper price for a property is? The answer is both science and art. The science is about the prices of comparable properties, or comps that were recently sold or are currently on the market. The art is about the strategy that’s used to try to get the highest possible price for the seller. That doesn’t necessarily mean slapping the highest price you can on the home when it’s listed. The better solution, pricing as close to the perceived current value to encourage multiple buyers to step up with offers.
You never get a second change to make a first impression. A too high price can be risky. Make that mistake, and the home could be overlooked by buyers, resulting in fewer showings and fewer offers, only one offer or, in the worst case, no offers at all. That negative first impression means the house might be on the market longer than it would have been if it had been priced realistically.
Another risk of over-pricing is that even if a willing and able buyer can be found, the sale might get snarled up by the appraisal if the buyer needs bank financing to close. Rising home values have reduced the incidence of problematic appraisals, yet the issue hasn’t gone away. It’s always wise to meet the appraiser at the property with a list of justifiable comps that can back up the purchase price.
The proverbial jury might never deliver a verdict as to whether a realtor should accept a listing the seller wants to over price. Sellers are in charge and will make the final decision on where to price their property. In the zany market earlier this year, sellers were getting the crazy high price they wanted. A middle ground is to pre-negotiate a specific price adjustment that will take effect at a pre-set time if the home doesn’t sell at the price the seller wants.
Some sellers openly declare their desire for a bidding war and will deliberately under price their home, either at their own fruition or at the suggestion of their realtor. There are risk with this approach. It can generate resentment as multiple buyers and the agents who submitted offers are naturally disappointed. The housing market is fluid and every precaution should be taken to price your home a fair market value. Please visit my website www.JohnnyBrooksHomes.com for helpful tips on buying or selling a home, scan my informative blogs and easy access to view local area homes for sale in Davis, California and the surrounding communities.