There is a major flaw with this advice. Active listings are only one component of a good market analysis. A REALTOR(R) will also look at sold and expired listings. Recent sold listings are by far a better barometer of market pricing than active listings. Active listings are priced at what the owners hope they can get, while solds reflect what the market actually was willing to pay. Are the sold prices in line with active listing prices? If so, then you may be good to go with only using the actives as a comparison point. This is usually not the case, especially in a down market. In fact, you may have to price even lower than the active listings or recent solds as prices continue to decline. The reverse is true in an up market where you may want to price aggressively ahead of current sales. The Phoenix area is in a downward pricing trend (a buyer's market).
Reviewing expired listings will help you better understand how much is too much to ask. These listings never got an acceptable offer because the sellers were unrealistic about the current market value of their home. Any home will sell if the price is set correctly to attract buyers. If this price is not acceptable to the seller, then there is not much to do other than take the home off the market. The seller can either wait until the market rises to their expectations, enhance the value of the home through remodeling (if this was the issue), or adjust the price to meet buyer expectations.
So, in summary, as a seller you need to look at three types of listings: Active, Sold, and Expired. Use this information to set a price that will get your home sold in a time frame you can live with. A local REALTOR(R) can get this information for you and provide a market analysis for your home.
Copyright (c) 2007 by Rod Rebello
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