TIPS FOR PRICING
YOUR HEATHROW FLORIDA, LAKE MARY FLORIDA OR
SANFORD FLORIDA HOME TO SELL
THE STAGNANT MASS is what the real estate industry typically refers to homes which have been listed for sale on the Heathrow Florida, Lake Mary Florida or Sanford Florida market for an extended period of time and have still not sold. Over time in any market – a buyer’s or seller’s market – properties flow in, are sold and flow out. However, there is always a segment of the inflow which sinks to the bottom and sit.
The usual culprit is overpricing. Many sellers like to try and price their home “just a little above market” to leave themselves room to negotiate to the market price. A good realtor will advise against this – not because it is easier for them to sell at a lower price – but because overpricing leads to a whole host of issues which will taint the house in the eyes of the market. It is a time tested axiom that the market, while slow in its process, is very efficient at achieving equilibrium between supply and demand – and with that – price.
The pricing of a home, whether it is in Heathrow Woods, Alaqua Lakes, Heron Ridge, Keenwicke, Wyntree or Chase Groves, Celery Key, or Egret’s Landing, should be directly proportional to both the market and your priorities. If you want to be out of your home in ninety days and the average sale time in your market is 180 – you will have to price your home lower to have any chance at achieving your goal.
Your real estate professional of choice should provide you with similar properties which have sold in your area. But these properties are a reference to the past – they are off the market. Your competitors are those which are on the market and for sale now. Price is generally how buyers prioritize their searches and a properly priced home has an excellent chance of selling in the first thirty days of listing in most markets.
Let’s look at several issues associated with over pricing a home.
1. Showings. Depending upon how overpriced your home is – it will either get no showings or will get a showing or two with no offers. Ninety percent of the buyers today start on the internet and they look for an average of 4 months or more before going out to see homes. This means they are well versed in pricing before they even hit the streets. Either they’ll look at your home to compare with your competitors – the ones they really are considering - or they won’t even bother.
2. Aid and Comfort to your Competitors. Overpricing helps your competitors. It makes their homes look more like bargains. It helps them sell and at the same time highlights your house brilliantly in a negative light.
3. Appraisal Problems and Limited Buying Market. If you do manage to get a contract on your over-priced home, most homes are financed in some fashion and the lenders routinely require an appraisal. Chances are excellent that your home won’t appraise at the contract price – especially in a declining market. This also means you have just limited your buyers to cash-only buyers and thus effectively wiping out 70% of your would-be buyers.
4. Being Labeled. Every new listing piques initial interest. And as the saying goes, “first impressions are lasting impressions”. Once it is out there overpriced, many agents will not come back to it. Eventually, with enough time being overpriced on the market, your home will establish a “reputation” as simply being overpriced. After that it will be ignored – even with agents entering your market segment with new buyers. This is the beginning of the end for your chances at selling.
5. Low Ball Offers. Once your home has been on the market longer than the average days for selling, the only offers you’ll likely attract are low-ball offers. Many buyers see stagnant listings as reasons to bargain harder assuming correctly that there is little competition vying for your home.
6. Stagnate Mass. Once you’ve firmly established your home as being overpriced and its reputation as such is solidified – you have officially become part of the stagnant mass. The stigma associated with can be virtually impossible to erase – even with often too late and too little price reductions. Reductions at this time are often ineffective since you are now chasing the market. You will do best in this situation to take it off the market and wait at least ninety days before relisting.
While pricing is only one component in marketing a home, pricing it incorrectly will immediately negate all other aspects of your marketing plan. Take these tips into consideration when setting your listing price. Good luck and good selling.
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