Pricing Your Property

19 November 2014

This week I want to talk about picking a listing price for your property. As a seller, the list price is the most important decision you will make. It’s even more important than picking a sales person. Why? Most sellers interview three agents. Usually it goes like this, two agents suggest a list price of $250,000-$260,000, the market value of the property. The third says “try $290,000” and the seller picks the agent at $290,000. Why? They think they might get an offer between $260,000 and $290,000 with the one agent and there is absolutely no chance for that price if they go with the other two agents. What the seller fails to consider is two points;

  1. Most showings for a new listing occur in the first two weeks. Over price the property and you get no showings during this period.
  2. Secondly, most sales occur at a sale price of 98% to 99% of the list price. You need a list price to be within 5% of the eventual sale price to get an offer started and to begin the negotiation process.

When you start your listing at $290,000 you then begin the slow dance of list price reductions. The longer property sits on the market, the less ou will get for it. After a period of time, buyers will think something is wrong with your property and you will end up getting an offer below market, probably within the $230,000 range. So talk to an agent who can educate you about the market and property values.

Pricing is where the sale begins.