Real Estate Tip of the Day
Don’t hope to lose when setting a price
Whatever happened to looking at the glass half full and not half empty?
Know how your home compares to comparable homes that have sold.
Ask your Realtor what their list price to sales price ratio has been.
Setting a list price to leave room for negotiation will get just that, negotiations to reduce the price by prospective Buyers.
Time and time again, we read where research has shown that by viewing a glass as half full instead of half empty, we’ll be made happier, healthier and wealthier. When selling a home, receiving the most money for your home will keep you in the running for preserving your wealth or perhaps increasing it. Why would you ever want to hope to lose before you even get started?! By selling your home for the most money this will likely make you happy and being happy increases our overall well being, which in effect can affect our health. Yes, we’ve all heard by some who swear that money doesn’t make you happy, but if you’re selling your home and you receive $500,000 for the sale of your home instead of $490,000 you’ll likely be happy about it, I’m sure!
All too often, you’ll find homeowners who want to put their home for sale by adding a little wiggle room, a little room for negotiation. My feeling for that has always been that if you price your home to allow for a little negotiation room, you will indeed get a Buyer wanting to negotiate the price with you. It’s the power of assumption. Assumptions can indeed influence behavior. It’s best to use this power to influence positive behavior and not negative behavior. (It’s important that the Realtor you hire knows how to use the power of assumption too.) Don’t automatically assume the worse, but rather assume that with your Realtor’s expertise and local Real Estate market knowledge you will trust her/his recommended list price, afterall, they say if you price your home at fair market value or just below this can drive up the ultimate selling price. This occurs due to what a good value represents. When a Buyer is searching for a home and sees that your home is priced with this pricing strategy, Buyer interest will likely come from multiple Buyers, particularly if your Real Estate market is experiencing a Seller’s market where there is a lacking inventory of homes for Buyers to purchase. Buyers will see your home price attractively and they want to jump on it before another Buyer attempts to present an offer and they quite often will bump up the price to make sure they win with you.
Now go back to the pricing strategy of viewing the glass half empty. You price your home higher than market value, and your home is missed being seen by qualified Buyers as your home doesn’t come on their radar. The Buyers that are searching for homes within your price range will find homes that they can purchase that are likely larger than your home and a little bit nicer for the same price; so why would they buy your home? So your home sits on the market. Buyers pass by your home. Buyers may come back to your home after weeks or months have gone by and wonder what’s wrong with your home, why hasn’t it sold already. The stigma of not selling is now setting in, like mold develops on the container filled with food in the back of your refrigerator that you have forgotten. You finally get an interested Buyer who realizes that you priced your home to negotiate and they’ll offer you a discounted offer as you must be desperate to sell by now.
You think to yourself; if only I had priced my home to sell from the onset, if only I had selected the Realtor who advised the pricing strategy of viewing the glass as half full, the Realtor who showed me homes that had sold that were comparable to my home, the Realtor who had a high list price to sales price ratio. Instead, I went with the Realtor who told me what I wanted to hear when I was viewing the glass half empty. I see how that worked out. Next time I sell a home, I’m going to think positive and listen to a trusted Real Estate professional who advises against pricing for negotiation.
Call me, Lynn Pineda, at 954-464-1100 and I’ll provide you with additional Real Estate tips when you decide; “it’s time to sell my home”. Or feel free to email me at LynnP@ImagineYourHouse.com.
Article written by Real Estate Agent, Lynn Pineda. Keller Williams Realty. Mar 20, 2014.