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Pricing Your Home? Wiggle Room is a Bad Idea!

Area may have the most effect on value but price is without question the most vital component controlling the sale of real estate. Anything will sell anytime, how long will it take is subject to on the price.

Ponder this – you may truly want to buy a car for your collection and your most loved happens to be a 1963 Corvette. So you catch wind of one available to be purchased, in mint condition,, across town but the only issue is the value, the owner is asking $150,000! Well, although you really, really want a mint condition 1963 Corvette, there is no way you will pay anywhere close to $150,000, in fact you know that the most a 1963 Corvette has ever sold for is about $200,000 and that was for a very rare model, which this one is not.

Because you are a bit obsessed with purchasing one of these cars you spend almost all of your free time, and some of the time you should be working, searching the internet for available cars. Through this exhaustive search you have become somewhat of an expert on the values of 1963 Corvettes, especially in your town. It is highly unlikely you will pay anyplace near $150,000, truth be told you realize that the most a 1963
Corvette has ever sold for is about $200,000 and that was for an extremely extraordinary model, which this one is definitely not.

So why don’t you go make an offer? Well, let’s face it when you see a price that is so high related to the actual value it makes, you think that the seller is either challenging to deal with and is out of touch with reality or that he must not really want to sell the car. Instead, he is just fishing for the one fool in the world that will pay $150,000 for a car that is worth $95,000. So you don’t even go look at it or call for more information…you just keep searching the various websites to find the car of your dreams.
You guessed it the Corvette in this example actually represents your home or other real estate you might be trying to sell.

Wiggle room is a BAD IDEA

Most sellers think that it is essential to “leave a little wiggle room” in the price. They think this because they think that all buyers will make destructively low offers…no matter what the asking price. This is an incorrect gesture!
Buyers pay the fair market value …in other words the buyers will pay you what the home is really worth! Your job is to find out what your home is worth and price it at or near that value.

Home for sale!
Home for Sale Sign!

This is where brokers and/or appraisers come into the picture. The right way to price your property is to have a professional REALTOR/broker or appraiser prepare a CMA (Comparative Market Analysis) on your property. A CMA involves finding recent sales of similar properties, fine-tuning for any differences, to arrive at a present market value of your property. Once you have this value you should have your broker set the asking price no more than 3% to 5% higher than that current market value.

Assuming that you do this, your property will sell quickly for a price equivalent to exactly what it is worth, or higher! Buyers as a overall rule DO NOT make “low-ball” offers, there are some rare instances when that happens but the vast majority of initial offers are 5% or less below asking price.

If sellers price their property properly, the buyers will know it instantly because, just like in the Corvette example, buyers spend every spare moment searching the internet for a home, they have made themselves experts on the market value of the particular type of home in the particular region they desire. For this purpose, the buyer also knows when a property is overpriced. Most buyers will not even go look at a property that is overpriced, they say to themselves “why bother?” they assume that the seller is irrational and/or is not truly interested in selling the property.

Moral of this whole story is – buyers will pay what it is worth – Seller’s job is to find out what it is worth and situate the asking price 3%-5% higher than that number…then sit and wait for the offers to roll in.

So, what can the agents at Birtola Garmyn High Desert Realty offer you? Our team is comprised of local real estate professionals committed to selling some of the most desired homes in Bend, Oregon! Selling these “right addresses” is the mission of Birtola Garmyn High Desert Realty. Let us know what you are looking for! You can take a look at all of our listings by visiting our website, or you can contact us personally by calling 541-312-9449541-312-9449

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