How Should You Price Your Home? Featuring Potato Chips. Really.

By
Real Estate Agent with Samson Properties VA0225077251

So you're selling a home and you're wondering how much you want to sell your home. Due to the excitement of having a profit, you think about it everywhere you go -- from the bathroom, before going to bed, even while shopping for groceries. While picking up on the items in the chips section, and you noticed that the prices always end in 9 -- $2.99, $4.99, etc. Then you asked yourself -- should I sell my house the same way?

woman reaching chip packs inside store

First off -- this pricing thing that end in nines is a part of what is called "strategic pricing," specifically the "left digit effect" -- basically the principle is to make the prices look attractive to the buyers. In a study conducted by MIT and the University of Chicago, they found out that nine-ending prices give the illusion of the price being perceived as something cheaper than the others, even if there are items that are more expensive than the others.

labeled bottles on rack

However, this has been tested to apparel, chips, goodies, and the things that you can see the most in groceries, convenience stores, and shopping malls. Would the same thing apply to the real estate business? Is strategical pricing even effective in real estate? Just to give an idea -- being in the real estate business for almost two decades, we did use the said strategy back then to sell our homes.

However, in such a strong market here in the DMV area where buyers search fo properties by the region, it doesn't really matter. The products I mentioned earlier and the places where you get them from are for advertising purposes and to make things more attractive to them by face value. However, for real estate, a lot of things come into play -- location, structural integrity, convenience, how the neighborhood is going, and more.

top-view photography of houses at daytime

Also, homes are different from one another, and it's not an easy comparison between two properties where a mere left digit trick would make it more attractive. Sure, it might help and you'll always be free to decide how you want the price to look like. But at the end of the day, it's all about the effort you put in to the home to make its market value go up -- renovations, staging, location, contract negotiations, and more.

2 person wearing blue denim jeans

It's not just about getting as many buyers as you want -- it's all about finding the right buyer for you. And one thing to do that is to start by listing your home at a reasonable price. Once you nail that and made sure that all things considered, the home looks attractive after the renovations and preparations you've done, the right buyer will come at the right time, and with the right price. Talk about a win-win.

man in purple suit jacket using laptop computer

Interested in selling your home, or do you have any questions about the real estate market? Let's team up -- 703-625-4949 or email at info@enovahomes.com. Make your move today!

Posted by

 
                             
Associate Broker
MRP, ABR, ePRO

NVAR, Life Time Top Producer
NVAR,Multiple Million Dollar Sales Club Member
Samson Properties
Cell - 703-625-4949
Email - info@eNOVAHomes.com
Web: www.eNOVAHOMES.com
 
Residential real estate agent serving Northern Virginia in Fairfax & Loudoun county over a decade and almost $100+M in sales volume experience. 


 

Comments (2)

Jim Patton
Aspire Home Real Estate 209-404-0816 - Modesto, CA
Realtor - Stanislaus ,Merced, San Joaquin Counties

HI Ritu Desai , good information.  The "9" at the end could also keep your home from being seen online.  If you price the house at $399,999 and someone is searching for a home from $400,000 - $425,000 they won't see yours.

Sep 15, 2021 03:32 PM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

I think using a round amount like $300,000 instead of $299,900 will result in a listing being seen by more people. People looking from $275-300K and also those looking from $300-350K will both see the home.

Enjoy your day!

Sep 16, 2021 05:18 AM