Pricing Your Home: The Competitive Approach
Although, there are many considerations, and approaches, involved, when it comes to determining the best price, to list a particular house, for sale, in a specific area, period of/ point in, time, and, in the best interests of a specific homeowner, and his needs, goals, priorities, and perspectives, quality, experienced, real estate agents, will focus on the bigger – picture, and fully articulate his reasoning, and marketing/ selling/ pricing approach, to his client! While there is, no such thing, as a, one – size – fits – all, approach, to doing this, in the vast majority of cases, when one evaluates local market conditions, and prices the property, correctly, from the start, the homeowner, benefits, to the greatest degree. With that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, some strategies, approaches, and meaningful ways, to proceed, in order to achieve the best results.
1. Competitive Market Analysis (CMA): The first step, in pricing a house, is to look at the competition, both, presently on the real estate market, as well as, in the recent past. Depending on the times, neighborhood, etc, this may be, as much as six to twelve months, or as little as 90 days. Ignore, what houses, have been listed for, and pay close attention to the actual selling prices, as well as, time on the market. Then, determine a realistic range, and, consider, at what level, pricing your specific house, might generate the most activity, and the highest number of potential, qualified buyers.
2. Pricing at the top of the market: If a house, has features, qualities, and is in a condition, far above the competition, in a way, which others will perceive and appreciate, then, you might wish to price it, at the start, at the higher part of the range. However, you should realize, doing so, might attract the buyer you seek, but, will also, generally, reduce the number of potential buyers, willing to look and view it.
3. Pricing at the middle: Although this is, often, a safe approach, it all depends, on a seller’s needs, priorities, and goals, and how quickly, he want to, or needs to, sell it. The advantage is, often, an increase in views. The disadvantage may be, turning – off, some of the higher – end buyers!
4. Pricing at, or below, the lower range: Are the other houses, on the real estate market, either, in better condition, or more upgraded? Is your specific block, or neighborhood, a positive or negative? How quickly, does the seller need, or want, to get it sold? Since a homeowner, does not have to accept any offer, in any price – range, there is little risk, other than, perhaps, limiting those, who may be concerned, why it’s priced, at the lower end. I have successfully, marketed and sold, houses, in less than a stellar, competitive position, and created a bidding war, where my client, has received, well, over, asking/ listing price.
In my, over a decade, as a Real Estate Licensed Salesperson, I have witnessed houses, which were priced, too high, at the beginning, and the end – result, was not in the client’s best interests. Quality agents explain, clearly, and with genuine empathy and understanding, the concept, which is, listing and selling prices, are far different entities, and a homeowner, should hire, an experienced, qualified agent, with pricing expertise!