As we remain in a recovery phase in the market, pricing continues to be one of the most critical aspects of any listing agreement you sign with your REALTOR®.
Too many times, I advise a client on price and human nature dictates that they will try and nudge the value of their home upwards to maximise returns. In this current market however, that is a sure fire way to get no showings. In the instance where a client does not take my advice, we end up with a series of price reductions until we start to see showing activity on the home and wouldn’t you know it, we get an offer very close to the suggested list price at the beginning of the discussion.
The reason this happens is the emotional attachment we have to the work that we have put into our homes and the perceived value we have of our homes. Naturally, a potential buyer will look at it from a different perspective and simply make a comparison to other values in the similar market place and form an opinion on what their offer will be. This is critically why the advice from your REALTOR® should be taken seriously. They have access to the data that a competing REALTOR® is using to advise the potential buyer. In a sense we all sing of the same song sheet although the musical score is still being composed.
The damage to the listing may not be as serious as it was a few years ago since we now have what I would term pricing stability. In other words, you are not chasing a falling market. You are however chasing a very narrow market. That means that every tool you have in your quiver, including pricing should be refined, researched and implemented. If one is off base, the buyer still has good choice of product, finishing levels, locations and pricing - so sellers beware!
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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet presents its columns "as is" and does not warrant the contents.
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