F&Q - Pricing right matters because the goal is to offer a property for sale at the right price that is based on current market values, taking into consideration location, condition, and how it compares to other similar properties that sold preferably within the last three months. A Seller's Agent prepares a Comparative Marketing Analysis (CMA) which is an "opinion of value." Just because it's a Seller's Market, doesn't mean or guarantee that a qualified buyer will be willing to pay more, or that the Appraiser and the Lender will agree to approve the loan, if it doesn't appraise at or above sales price.
Homes that are overpriced often take longer to sell and the property may be passed over by educated buyers who are closely paying attention to what their Real Estate Agent is telling them and showing them current marketing trends and analysis. Can you imagine a prospective bride going into a bridal shop and offering a Sales person more than the sales price on the tag? That bride is probably on a budget and knows that when there's a wedding, there are many additional expenses. Although a dress should be unique and stunning, what good is an overpriced dress if the bride and groom don't have enough money for the cake, the music, meals for guests, a tux for the groom, and all the other expenses needed when two people get married?
The problem with pricing may get confusing because Buyers and Sellers may rely on Zillow or other INTERNET findings. What is correct about Zillow, is information is based upon "automated valuation models," which may contain erroneous, incomplete, data that is out-of-date, or even properties taken off the market or sold months or years ago. The key point is this: According to the National Association of REALTORS®, "Zillow doesn't adjust for property conditions and sales concessions." A trained and licensed agent who is experienced and educated should know and understand current pricing strategies that can improve Buyer and Seller trust and confidence.
©Patricia Feager, 9/15/2016
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