Is Positioning a Home to Sell an Art, Science, or is it Just a Guess?
Pricing a home correctly to sell in a particular market is the key to success, assuming everything else about the transaction goes as it should.
But is positioning a home to sell an art, science or is it just a guess?
There are lots of local market statistics to use in the analysis:
days on market
available inventory (absorption rate)
average sales price of comparable homes sold within the last 90 days (more or less depending on the market and availability of comparables)
average sale price/list price ratio, to name a few.
Knowing this statistical information for the local market is just a part of the puzzle.
You also have to understand, and communicate, what this means for the seller and how this translates into appropriate market positioning.
The facts of the local housing market will hopefully over-ride emotional pleas that “my house is special or different,” the “neighbor’s-same-house-sold-a-year- ago” high price justification, the “just testing the market” mentality and other rationalizations for over-pricing.
If this information fails to impress, perhaps it’s better to simply move along. An over-priced home is not going to sell in this market, and no amount of marketing will change that.
Overpricing your home can be a huge mistake!
It costs money, is a waste of time, and no one benefits...least of all the seller.
Read this article by Bryan Robertson with a video/Google+ hangout on several REALTORs’ thoughts on pricing a home.
Or go straight to the Google Hangout video hosted by Rich Cederburg from Albuquerque.
Other factors which affect a home’s value, but are less precise and perhaps are the art of pricing include views, location, interior and exterior condition, amenities, deferred maintenance, buyer demand and similar issues.
Add another dimension to the pricing process with a visit, along with the sellers, to see the competition?
No matter how reliable and accurate the data, and how artfully we combine our expertise and knowledge to help the seller finalize pricing, the reality is the list price is just a guess.
Oh, it may be a very good one, and probably is, and you may be confident it is on target.
But until you are on the market and the market reacts accordingly, you simply do not know for sure that you are correct.
Is pricing a home to sell an art, science, or is it just a guess?
It’s really all three, don’t you think?