Pricing That Listing To Sell Every Time! - reblog
Price is the most important tool that we have in our marketing bag when we sell a house, You certainly can't move the house or change the neighborhood location, You can do somethings to improve the condition, but price is the most important tool because it needs to be right on to even get the attention the house needs to sell. Here is a great article that every seller should read on pricing homes correctly in the market.
Getting a home to sell EVERY time is really not rocket science. Some people with homes on the market like four years might think I am crazy with that statement but at SOME PRICE, every house will sell. So some discussion for both agents as a review and for consumers. What sells a home?
A motivated seller
A listing in saleable condition
Priced to sell
I cannot emphasize that last one enough. If you get the price set wrong, you are pricing the home to SIT, not sell. I reiterate that point with home sellers all the time and they either get it or as a potential listing agent you need to walk away cause EVERYONE is just wasting their time to get to the RIGHT price.
Points on doing the price evaluation in the market to get to that right "asking price":
- The only "comp" to use is a "comp" that is a SOLD transaction
- Comps should be as recent as possible going back no more than 6 months. Underwiriters of loans try to go back just three months, but good luck on enough sample size with that
- Properties need to be in the immediate subdivision or then go out to a 1 mile radius
- Need at least THREE comps
- All SOLDs must be on new loans - no cash or owner financed ones since they skew the results without appraisals often or investor properties
- You can discard one foreclosure in a neighborhood but if the area is MADE UP of distressed properties, that is the market
- A note on matching up square footages - less than 2700 sqft be within 150 sqft, 2700-3000 sqft be within 300 sqft, greater than 3000 sqft be within 10% of the subject property
- The age of the home needs to be within 5 years of the subject. NEVER compare new to pre-owned
- Be careful when looking at appraisers allowances in their report. The total value of the adjustments should NEVER exceed 10% of the comp's sales price
- Landscaping and window treatments SHOULD NOT be given a dollar value
- Lowest size homes in neighborhood have highest dollars per square foot, and highest size homes have lowest dollars per square foot. Keep this in mind.
- Do not PAD your asking price. Set it at market to try and get multiple bids
- Gunite or Pebble-tek pools fetch more in a property value increase than fiberglas pools. Often a pool will only yield back 10 to 30% of its original cost. 5 year old and older pools don't add much at all
- Remember if you show Actives, Pendings, or Expireds with your SOLDs, that is for information only and FANTASY WORLD more than anything else
- Review the archive pricing in the MLS with a home seller to see what the seller has been trying to do in reducing a price to get it to sell. Helpful for buyers
- Do absorption analysis (days on market) to see where houses sold quickly at what price and where they took longer at slightly higher price
- One advanced technique in MLS search for comparables is search also by "elementary school" as this will bring in similar houses in area feeding into that school
- Look at interior pictures of SOLDs to see what the insides look like AND preview ACTIVES to see what other insides look like by agent or also with seller/buyer
It is both a pricing war between other properties around the subject property and a "beauty contest" to get a home ready to entice buyers with the wow factor to make an offer.
PRICE YOUR PROPERTY "right" and IT WILL SELL !!!
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