How To Avoid Over Paying For A Condo?
Viewing condos online and attending condo tours are a good way to get familiar with condos and different asking prices. But do you know the true market value of a condo?
This is a question faced by most condo buyers, because the asking price of a condo and the final sale price could be worlds apart!
So how do you protect yourself from the dreaded over paying syndrome?
Just like anything else in life, research and due diligence is strongly recommended. First you need to understand how sellers price their condos. As surprising as this may seem, there are four main pricing strategies used by sellers.
Let’s Examine The Four Main Pricing Strategies Used By Sellers:
Strategy # 1: Clearly Over Priced.
A condo could be over priced by several thousand of dollars. Believe it or not, some sellers will even price their condos $50,000 or $100,000 above market value. Before attempting an offer on such condos, careful analysis of the advertised asking price must be done. The sellers may over price for several reasons; one of the obvious is to make extra money! Be sure to seek help from your Real Estate Expert on recent comparable sales. A $100,000 extra out of your pocket is an extra $100,000 in the sellers pocket!
Strategy # 2: Over Priced By A Few Thousand Dollars.
An extra $3K, $5K or even $10K on a listed condo price sometimes can make the difference between a condo selling or becoming stale on the market. I cannot even count the amount of times; I’ve seen a condo sit on the market for weeks or months without being sold. Then suddenly a price drop of $3K, $5K or even $10K and before you know it the condo is sold. Be sure to seek professional help from your Real Estate Expert on recent comparable sales. As sellers pricing your condo is delicate and professional help and advice can really help you avoid stress and frustration. Be sure to seek professional help from your Real Estate Expert on recent comparable sales.
Strategy # 3: Priced At Fair Market Value.
These condos normally sell quickly and sell for close to asking price. Buyers seek professional help from your Real Estate Expert on recent comparable sales.
As a seller pricing your condo with a 1-2% negotiation room could position your property to a larger pool of buyers resulting in a quick sale, sometimes full asking price or even over asking price. Be sure to seek professional help from your Real Estate Expert on recent comparable sales.
Strategy # 4: Condos Priced Below Fair Market Value.
This is a very aggressive strategy used when sellers need to sell quickly or sometimes in a sellers market. While this may be a good strategy for sellers to attract multiple offers, often ending into in a biding war! Buyers beware……. this is where your Real Estate Expert can be most valuable as you don’t want to overpay in the heat of competition! You want to ensure you can afford and love your new condo after you’ve moved in, instead of being condo rich and cash poor. Be sure to seek professional help from your Real Estate Expert on recent comparable sales.
The next time you’re out viewing condos, ask your Realtor which one of the four main pricing strategies the sellers are using?
Happy condo hunting & good luck in your search!
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