So I have heard some people tell me "If a home goes under contract in the first few days it was under priced." Yes, that surely has been a strategy used in hope of receiving multiple offers, offers with escalation Clauses, doing a "best and Final" and getting a solid offer with the terms the seller wants. And the final sales price is often higher than the listing price!
I first saw this strategy used with the banks when they quickly discovered they could not price their "empty" homes at market price. They were flooding, getting damaged, and the banks were spending more and more money on the upkeep and repairs of these homes.
So under-market pricing became their strategy in many situations.
And effective it was. But, pricing at fair market value and going under contract quickly is a seller that has positioned what is now their "Product" correctly within the market place. Just as Macy's, Nordstrom's, Target, CVS, etc., all do. If the item doesn't move- it goes on sale and then eventually into the clearance area.
My recent listing went under contract in six days. With a plain and clear reason, it was positioned and prepared correctly for the market. More importantly, my Sellers listened to the professionals and to my team. We looked at the market and the comparable homes. We looked at what other buyers would be looking at. We then evaluated the home and its needs: its colors, its current decor, its deferred maintenance and addressed all those areas and more.
The home was painted with a fresh and current color palette that complimented the architectural details of the home. Carpets were replaced as needed and my Stager worked with the items my seller had. Yes, using items within the house, removing many, rearranging many and balancing them in size and proportion with individual room and creating a "Theme." Creating a theme might seem minor, it is not, it is very, very effective.
This takes time but once complete you have a product that can compete. And that it did. The buyers saw the true buildout and amenities that this home offered. They were not distracted by color, clutter or confusion.
A home going under contract quickly has been evaluated and prepared correctly as a "product" for a Market Place...the Real Estate Market. That is good preparation, planning and marketing. Especially when the Seller's get their price. It is the knowledge and guidance of a Professional Sales Team with layers of vendors and specialists within their own field.
It is a who Seller understands that the way they "Live" in their home is not the way they position their now "Product." It is knowing the market, knowing what the Buyer's are looking for and making it a home that Buyers can see themselves living a wonderful life in.
If a home goes under contract in he first few days at fair market value, it was correctly prepared for the market. And add to that the holding costs that are eliminated- something else to calculate in to the final profit if you are holding onto that "product" for months. Those can be shocking numbers when you calculate them in, or should we say out of the profit. And if you are not placing a great home on the market, just like Macy's, Nordstrom's, Target, CVS, etc., the home will most likely be reduced and perhaps even put in the "Clearance Aisle" because buyers now believe there is a problem with the home since it wasn't snatched up immediately.
And oh the stress on my Sellers through those months if not done right! Its wearing and tearing and similar to getting beat up. It plays with their psche about them and their "home."
No thank you to that advice and conclusion that a home that goes under contract quickly was underpriced, that's why we are the professionals. My Sellers and their needs always comes First. That is honesty, truth and the best professional services and team. Life moves quickly and so do the best homes on the market.