Real NEastate: How to price your home

Q: I want to move in 2011. What is the best thing for me to do to try to sell my Northeast condo quickly and for the highest price?

A: The most obvious answer to this question is to price it right. I am not talking about giving it away; I mean make sure you are not pricing it too high. Be competitive. Don’t price yourself out of the market. Sometimes sellers think they can get more money for their home when they price it higher when, in fact, the opposite is usually true. How can that possibly be, you ask? Here is a common scenario that plays out regularly in the real estate world:

The seller lists his home above market value against the advice of his real estate agent and even though this is a buyers market. Potential buyers find other homes priced better and buy those instead. Months and months go by with no offers.The house languishes on the market. So the seller finally relents and reduces the price. Now it’s priced where all the rest of the homes are priced.

Unfortunately for him, the price is still too high because any potential buyers made up their mind that, even though it may be priced fairly, there must be something wrong with it. The buyers justify their negative thoughts about the property saying, “Since it’s been on the market for so long.” Yes, buyers do know how to find out how long a home has been on the market.

So there his property sits – finally priced right – but now it’s been on the market for several months and still no takers. The seller has no choice but to reduce the price again to attract new buyers. It gets reduced and it’s at a great price for the neighborhood. It would have been great if it had been this price at the beginning because it probably would have sold quickly. The seller thinks, “Now it’s a real ‘bargain!'”

The property gets the attention of some new buyers. The potential buyers see how long it’s been on the market and think, “I can get that for less since it’s been on the market for so long and the seller must be desperate by now.” Which he is. So the buyers offer even less. The seller is ready to move so, even though it is thousands less than he wanted, he takes it.

Maybe if the seller priced it right the first time he may have actually gotten closer to the asking price. Don’t make the same mistake. Price your property right the first time and you’ll be more likely sell it quickly and for the highest price.

Stacey McCarthy is a real estate agent with the McCarthy Group of Keller Williams. Her Real NEastate column appears every Wednesday on NEastPhilly.com. See others here. Read other NEast Philly columnshere.

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