My biggest fear.
When looking through the San Antonio MLS listings on the market, I sometimes get a bit scared by what I see. It’s not 100% of the listings I see, in fact, it’s a small percentage, but it scares me nonetheless.
What is it that I see? Listings that seem to be a game to the seller and their listing agent. Price fluctuations all over the charts. Poor photos or a complete lack of photos. People not taking full advantage of the MLS system the San Antonio Board Of REALTORS® provides us. The even bigger part of this fear? That the seller doesn’t know their home’s sale has become a game.
The strategy of selling your home.
The “let’s see how this price works out” theory of real estate seems like a huge gamble to me. Yes, we all want to get top dollar for our home when we sell, but when I see price fluctuations on a consistent basis and I’m representing a buyer for your home, guess what I see? An opportunity. Whether you had your agent overprice your home or your agent told you it was worth much more than it is, all I see is a chance to use my knowledge and skill to get my client a better deal.
Most overpriced homes wind up selling for less than they’re worth, because a good agent knows how to use this to their advantage. Do you want to let someone have an advantage over you when the price of your home in on the line? I’m guessing the answer is a resounding “no.”
Pricing your home inline with the market can get it sold faster, for a price closer (or above) your asking price, and remove the anguish of waiting, waiting, waiting, and hoping someone will make an offer on your home. And the constant price changes only add to your stomach ulcer.
I know this, because I did it when I sold my first house. I lived in a hot Los Angeles market and I tried to play the game. I waiting, waited, waited – and wound up feeling sick half the time. In the end, I did sell my house for a nice profit, but these were the days in the run up to the market crash. The days when homes in California were appreciating at alarming rates (mine at 30% over three years). I’m sure you’ve seen the news – those days are gone.
“Don’t worry, they’ll lower their price again.”
Imagine we’re looking for a home for you to buy. I show you a great home that you love…and the price looks good, so we decide to dig a little deeper with the intent of writing an offer. I pull the comparables in the area and we sit down to discuss. What do you think when I show you the price history on the home?
You’re probably thinking exactly what I’m thinking. They’ve made a price cut every month of x amount of dollars. If we wait another month, they’ll do it again. We can buy this house later at a better price. That day may or may not come, but that seller’s decisions on pricing have just made us move on. They lost their buyer.
Now back into your shoes as a seller. Do you want that to happen to you? Do you want a buyer who is eager to buy your home say, “We can wait this one out?,” and in the meantime possibly find a home other than yours? Do you want to delay the sale of your home another day? Month? Year? Of course you don’t.
It’s that easy.
The solution couldn’t be simpler. Price your home right. Price it to sell. Price it to get people in the door and then wow them with the rest. Some people suggest underpricing your home in order to create “buzz,” but it’s not necessary. Price it right and it will generate buzz. Price it right and you could wind up with multiple offers, no matter the market. Price it right and get it sold so you can put your mind at ease and move on to your next home.
What about pricing it to allow a cushion for negotiations?
In today’s climate, buyers are being more savvy when it comes to offers. Some sellers and agents have a theory of pricing it slightly above market value in order to allow for a cushion in negotiations. You don’t have to accept low offers. You should look at every offer, no matter how ridiculous and weigh it based on your situation, but if the offer is too low, counter it. Don’t throw it away – always counter the offer.
A lot of buyers like to test the waters before making a more serious offer. They know they’ll pay more for the property, but why should they if they can get away with a lower price. I know this for a fact, because my clients do it and I help them do it all the time. When I work for a buyer, my goal is to help them, not the seller.
Pricing with a cushion for negotiation is a tactic that a good agent can see a mile away. We know it’s priced that way, so we skirt right around the issue and offer fair market value for it with our buyer-clients. If you want to stick to your higher-priced guns, I’ll recommend my buyer keep looking.
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image courtesy of anne.oeldorfhirsch