It's tough being the seller in a buyer's market. However, you can improve your odds with the right research. In many cases, making a smart deal and getting the best price comes down to studying your market and being an educated seller.
It doesn't really matter how much money you think your home is worth. Nor does it matter what your agent thinks. The person whose opinion matters is the buyer who makes an offer.
Price your home right
Pricing homes is part art and part science. It involves comparing similar properties, making adjustments for the differences among them and tracking market changes. Study the supply and demand within your neighbourhood to consider whether to price your home above or below the market value.
Pricing your home lower than your competitors can essentially generate more offers, thereby driving the price higher. On the other hand, pricing it too high and you risk buyers going into “sticker shock”.
The benefits of pricing right
- Your property sells faster because it is exposed to more qualified buyers.
- Your home doesn't lose its "marketability".
- The closer to market value, the higher the offers.
- A well-priced property can generate competing offers.
- Real Estate Professionals will be enthusiastic about presenting your property to buyers.
The result of overpricing
Many sellers believe that if they price their home high initially, they can lower it later. Often, when a home is priced too high, it experiences little activity. Gradually, the seller will lower the price down to market value, but by that time it's been up for sale too long and some buyers will be wary and reject the property.
On occasion, the price is dropped below the market value because the seller runs out of time and the property is sold for less than its value.
Missing the right buyer
You may think that interested buyers "can always make an offer," but if the home is overpriced, potential buyers looking in a lower price range will never see it.
Those who can afford a home at your asking price will soon recognize that they can get a better value elsewhere.
The importance of early activity
As soon as a home comes on the market, there is a flurry of activity surrounding it. This is a crucial time when Real Estate Professionals and potential buyers sit up and take notice.
If the home is overpriced, it doesn't take long for interested parties to lose interest. By the time the price drops, a majority of buyers are lost.
The longer your house sits on the market, the less cash it commands. If you have to sell in a slow market, study the current trends, forget old values, recognize current values, and price your house lower than others in your market. Start at a sale price that is going to entice buyers from the get go. You will be the first one to sell in your neighbourhood and you will win from there.