Pricing Your Property

THE BENEFITS OF PROPER PRICING

There are several benefits of properly pricing your property. They include the following:

QUICKER SALE

• When a property sells faster, there are fewer carrying costs which may include mortgage payments, taxes, insurance, and maintenance.
• A quicker sale creates less inconvenience. Anyone who has moved before knows the energy it takes to prepare for a showing - keeping everything tidy, ensuring there are no lingering food/pet smells, making arrangements for pets/children/elderly/infirmed, making sure all valuables and prescription medications are secured, and more.
• Proper pricing creates less stress by helping the property sell more quickly.
• At market value, your property will gain exposure to more prospects who can afford the price.
• Sellers who list at that high price are looking for that one buyer who will pay it. Sellers often do not realize that they have discouraged many potential buyers who could have afforded the property.  
• The final sales price will probably end up having been affordable by more potential buyers.
• Sellers often end up accepting a lower price, at a much later date than anticipated, than they could have gotten if the property were priced properly to begin with. Unfortunately, this lower price also comes with extra carrying costs - resulting in the loss of even more of their hard-earned equity.

INCREASED BUYER AGENT RESPONSE

When Buyer Agents are excited about a properly priced property, they make special efforts to contact everyone they know who may have an interest and even some who didn't know they were interested! Knowing it is priced properly for its market, they fully expect it to sell soon and encourage their prospects to act quickly. Their excitement is contagious!

BETTER RESPONSE FROM MARKETING EFFORTS AND SIGN CALLS

• Calls to REALTORS turn into showings when the price is not a deterrent.
• Serious prospects who are working with REALTORS are typically well-versed in asking prices in the area they're looking in.
• Serious prospects prefer not to waste their time on a property they perceive to be overpriced. They prefer instead to "wait and see".

HIGHER OFFERS

• Buyers fear they might lose out on a good property when it is priced well.
• Sellers are less likely to receive "low-ball" offers.
• Better pricing attracts MULTIPLE buyers - in pretty much any market.

MORE EQUITY TO SELLERS

• If a property is priced right, the excitement of the market produces higher sale prices.
• Sellers retain more equity in terms of more cash due at closing and fewer carrying costs.

The three main factors that determine a property's market value are LOCATION, CONDITION, and PRICE. A seller only has absolute control of one of these. The LOCATION obviously cannot be changed. They have control over CONDITION - to an extent, however, financial burdens may have limited available resources during the course of ownership. CONDITION can also be subject to the tastes of prospective buyers. This means that PRICE is the only factor the Seller has 100% control over and should be determined by recent sales of comparable properties in your immediate area. Pricing a property right the moment it hits the market is CRUCIAL since that is when it will get the most attention from prospective buyers. You may think you want to start out higher and test the market, but this typically translates to less equity at closing for all the reasons mentioned above. PRICE. MEANS. EVERYTHING.