3 Pricing Strategies For Your Home
If I’ve heard it once, I’ve heard it a thousand times…let’s price it high and see what happens. Sellers seem to think that’s a good strategy...
If you’re thinking about selling your home, I’m going to take a guess and say that you would rather your home sell quickly than sit on the market for who knows how long. So, your pricing strategy matters. Am I right?
It’s your listing agent’s job to get the most money possible for your house in the least amount of time. And there’s an art and a science behind that.
What is Market Value?
The most important piece of this conversation is “what is market value?” Market value is what a house will sell for on the open market under normal conditions. Oftentimes we help sellers understand “market value” as being the amount a buyer is willing to pay for your home in its current condition and in the current market conditions.
First Strategy - Pricing Above Market Value
The first pricing strategy is pricing above the market value. I get it, you want to list your house at a high price and “see what happens”. This strategy is rarely the best option… why you ask? Because realtors and consumers will immediately recognize it’s an overpriced listing. Buyers in today’s market are incredibly knowledgeable, they have all the tools of the internet at their disposal… and they use them!
When you price your house high, you will end up chasing the market… and many times will end up selling for less than you would have if you had priced the home correctly from the start. What does it mean to “chase the market”? You will need to reduce the price to increase buyer interest and re-engage the consumer on your listing… and worst yet, a house that sits for too long has buyer asking themselves “what’s wrong with that house?”
While we understand why sellers want to pick this strategy, it can ultimately end up costing them in the long run.
Second Pricing Strategy - Pricing Right At Market Value
The next pricing strategy is to price right at the market value. When you price a home at market value, you are placing your house in front of the most qualified pool of buyers, the serious ones. Both agents and consumers will recognize the house is fairly priced, and will be eager to see the inside of your home yielding more showings quickly.” In today’s competitive market, this strategy will have you an offer in just a few weeks, if not days, and could still have multiple offers if you have a great listing!
Third Pricing Strategy - Pricing Below Market Value
Everybody loves a bargain! The last pricing strategy is pricing a house below the market value. When you price a property lower than the market price, you are telling potential buyers, “Hey, come look at this house. You don’t want to miss out on this great deal!”
The idea most people have when pricing a property lower than market value is that the small price tag will drive more traffic and eventually end up in a bidding war over the house.
This strategy is more likely to work in a Seller’s market when there’s very little inventory and lots of buyers in need of a home. Or if the home is less than desirable condition or the Sellers are on a short time frame and need to move a listing fast. However, In a balanced market or a buyer’s market under normal listing conditions, this is NOT the best strategy.
You're Ready List Your Home For Sale!
Pricing a home is one of the most important aspects of selling. The best place to start is a conversation with your listing agent about your goals of selling and your timeframe so you can craft a strategy that works best for you in your situation!
Now that you know the 3 strategies for pricing a home to sell, you’re ready to begin the process of selling your home! If you have any questions about the current market or how to sell your home for top dollar in the least amount of days, feel free to reach out!
As always, if we can help you move in, move out, move up, or move on, let us know.
Anchor Real Estate is here to help!