In most industries today, buyers are doing their research before they shop. Likewise in real estate, buyers typically have a very good idea of the market they are shopping in as well as the property values within. With such knowledgeable shoppers, it is increasingly important that you have the resources to price your property competitively.
In order to attract the right buyers for your property, here are some important listing tips to consider!
Factors in Determining Your Property’s Value
Before you compare your home to similar properties and establish a competitive list price, the following points should be considered.
- Location! Location! Location!
- Size of home and lot
- Style of home (Bungalow or 2 storey, etc.)
- Condition and finishes/upgrades
- Buyer Demand
Get to Know Your Market
A comparative market analysis (CMA) is an indicator of what today’s buyers are willing to pay for a home. It compares the market activity of homes similar to yours in your neighbourhood.
Those that have recently sold represent what buyers are willing to pay. The properties currently listed for sale represent the price the seller is hoping to obtain and show you what your competition is. The listings that have expired were generally over-priced or poorly marketed.
Together, you and your REALTOR® will review the CMA and establish a competitive market position for your property.
The Importance of Early Activity
As soon as a property comes on the market, there is a flurry of activity surrounding it. This is the crucial time when REALTORS® and potential buyers sit up and take notice.
If the property is over-priced, it doesn’t take long for interested parties to lose interest. By the time the price drops, a majority of buyers are lost.
The Results of Overpricing
Many sellers believe if they price their property high initially, they can lower it later. Often, when a property is priced too high it experiences little activity. Gradually, the price will come down to market value, but by that time it’s been for sale too long and some buyers will be wary and reject the property.
On occasion, the price is dropped below market value because the seller runs out of time. The property sells for less than it’s worth.
Missing the Right Buyer…
You may think that an interested buyer “can always make an offer” but if the property is over-priced, potential buyers looking in a lower price range will never see it. Those who can afford a property at your asking price will soon recognize they can get better value elsewhere. For more insight on how to make sure the right buyer sees your property check out our blog on positioning your price for optimal search results!
Understanding the Factors that Influence Overpricing
Be aware of the factors that may tempt you to list your property too high.
- Extensive renovations/hidden costs
- Desire to purchase in a higher-priced area
- Original cost of the home was too high
- Lack of real market information
- Building in “bargaining room”
- Perceived emotional value
The Benefits of Pricing Your Property Right
With market knowledge and accurate property valuation your property can be positioned at the right price point to generate early activity and attract the right buyers. The right price also means:
- Your property sells faster, because it is exposed to more qualified buyers.
- Your property doesn’t lose it’s “marketability”
- The closer you price your property to marker value, the higher the offers
- A well-priced property can generate competing offers
- REALTORS® will be enthusiastic about presenting your property to buyers
Pricing your property right is important! With these helpful tips, you’ll be armed with valuable knowledge when it comes to selecting your list price. However, listing a property is complex and there are still many other items to consider. Reach out to us at email@example.com or 519-586-7922 if you have any questions about listing your home.