Adequately pricing your home is a key point to the success of the sale. Today’s purchasers are savvy and along with their real estate agent they are aware of current market trends and what neighbouring homes have sold for. Today’s buyers are educated.
If a home is over-priced many negative outcomes can happen:
- Many potential buyers will not shortlist a home and set up an appointment if they believe it is out of their price range.
- Since an appraisal is often required when financing a property, it is futile to price a property for more than it is worth.
- Properties left on the market for extended periods of time usually become “stale,” and people begin to believe there must be something “wrong” with the house because it has not sold. A promoted price reduction can also leave potential buyers feeling “no one wants to buy that house” which in the end can cause a lower price being accepted to close the deal.
- Many agents will not take their clients to see the house as their commitment is to find the best home for their client within a pre-set price range. If overpriced, it will not be seen.
- Overpricing lengthens marketing time, and invariably results in a lower selling price than would have otherwise been obtained.
- Your home can be missed on an MLS search for a certain price category if it is out of range, thus missing out on potential buyers.
What is the Key to Effective Pricing?
The key is analyzing the data of other homes sold in your neighbourhood, and understanding current market conditions and mortgage rates to set the most effective price for your home to attract qualified buyers.