Wednesday, November 16, 2011

The Voice of the Agent: "Pricing a home to sell, not to sit"

Bi-weekly snippets and tidbits of Real Estate for you from Realtor® Dan Irish.
Contact DM Irish here for questions and topics you want answered!

Pricing A Home To Sell, Not To Sit

You've watched your neighbor's home list and sell.  You know what you've put into your home and what is owed on it.  You know the emotional value you put on your home because your kids were born and raised there and many memories were made in this house you made into your home.  However, the honest truth is that the market and buyers don't factor any of that in.  Unfortunately, what you owe on your home doesn't determine what it can sell for.  Only the market in your area will determine what you can get out of the sale of your home. 

So what's an example?  Joe and Suzy Smith owe $200,000 on their home.  It's a nice 4 bedroom, 3 bath home that looks great from the inside and out.  This Smiths really want to list their home for $250,000 because "It's a great home and we need to get our money out and clear all of our costs."  Upon receiving a market analysis from their Realtor®, they find out their home is only able to realistically sell at $210,000 AND they owe closing costs and real estate fees on the bottom line. 

It's going to be tight, but it will be doing the client a disservice to list their home way above fair market value where the Smiths want to list.  Doing so will mean they'll likely be encountering longer days on the market, sellers' frustrations, and likely netting much less than they could have gotten from the home sale if they would have been priced correctly when first listed.

The truth is it doesn't really matter you think your home is worth.  Nor does it matter what your agent thinks or 10 other agents just like him.  The person whose opinion matters is the buyer that makes an offer.  If the ultimate goal is to get sold and move on to the next smaller or larger home for the buyers' original reasons for selling, then we have to be competitively and aggressively priced from day one in this market.  We just can't afford not to be!

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