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Friday's Real Estate Tip

By Mike Giles

Real Estate Agent with Keller Williams Realty Evolution

June 13, 2014 12:34 AM

Friday's Real Estate Tip

Should you use a round number or the 999 theory when pricing your home?

If you go back to prehistoric times, let’s say 1980, the old 999 theory was a psychologically effective way of tricking people into thinking they were paying less than they actually were. I didn’t buy into then and I don't buy into it now.

To me it's like setting your clocks ahead 10 minutes to make sure you are on time for appointments and events. It may work once or twice but after a day or so, you automatically subtract the 10 minutes in your head.

Back then, the 999 theory was cute, but didn't really have an influence on a sale. Today however, it can reduce the number of people who know your home is on the market.

Most of the big search sites use round numbers for their Max/Min price ranges, some allow you to type in a number. If you are on the cusp of one of these ranges, especially the Min. price, anyone using that number as their default price could not be seeing your home.

For example. Say Trulia sets their prices in $50,000 increments and you have your home priced at 249,900. Anyone using a min. range of 250,000 will not see your listing over $100??

Most buyers understand that you need to be pre-approved and know going in what they can realistically borrow. Their tendency is to use that as a max and go back $20K-$50K and set a minimum. If they have been approved for $230,000 and set up a showing from $200k-230K and you have your house listed at $199,999 to psych the buyer into thinking they aren't paying $200k, you are reducing the pool in a game that is all about numbers!

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Michael Giles

Keller Williams Realty

978-882-4659

mgiles@kw.com

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Paul Peck

Peck Drywall and Painting serving Brevard County, Florida - Melbourne, FL

Licensed Drywall and Painting Contractor

Never thought about it like that. Great post Michael!

-Paul

Jun 13, 2014 12:52 AM

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Rainmaker
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Friday's Real Estate Tip

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Mike Giles

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