When the market favors sellers, it can be tempting to test your luck with your listing. Today, I’d like to go over what you should do instead.
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When you start the process of selling your home, you have to make a shift in your perception. Think of home selling as a business. When you list your home, imagine you’re selling a product in a much larger market.
You can ignore the market, but to do so would likely lead to a lot of regrets. There are a lot of risks associated with pricing your home incorrectly, one of them being that you could wind up with less money than if you priced your home appropriately to begin with.
When the market is hot, it’s tempting to test it. But, buyers are smart. They have access to a much higher level of data these days. So, as they search for their next home, they make a lot of comparisons between different properties.
Rather than testing the market, it’s important to price your home correctly from the start. Buyers won’t put an offer on an overpriced listing, and there are three reasons why:
1. They don’t want to offend the seller. It goes against human nature to offer significantly less than what is being asked.
2. They believe the seller knows the home is overpriced. This belief may be erroneous, but buyers tend to truly feel that if a seller wanted to strike a deal they would lower the price.
3. They assume the seller has already turned down low offers. They think, surely, someone must have already tested the price. In reality, the listing may not have seen any offers yet at all.
It is entirely possible, in a seller’s market, to get multiple offers on your home if you price it correctly, especially if you list it in a range where a lot of buyers can qualify and absorption rates are low
When pricing your home, make sure you listen to your Realtor about the current value of your home. Putting your home at or just below market value provides a compelling reason for buyers to submit offers. However, buyers will only be motivated to make an offer over asking price if they have good reason to do so. One common reason they might do this is if they’re competing with another buyer.
Make sure you carefully review each offer you get once they start coming in. One offer may be a few thousand dollars higher than another, but there are other factors you should consider when deciding between multiple offers. The offer with the highest price may not be the right choice over another offer that is lower but has better terms or comes in cash. When examining offers, pay attention to any possible contingencies.
Above everything else, make sure you’re letting your Realtor guide you through pricing your home and selecting an offer.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.