To price your home correctly means to draw more buyers to your listing. I like to show my clients the following chart. By listing high, you are reaching only 10% of the market. If you price your home at market value, you’ll grab the attention of 60% of the market. But what happens if you price your home at 10% below market value? I know. It sounds crazy. But, by pricing it below market value, you are actually attracting 75% of the buyers.
What does this mean to you?
Let’s keep this simple…just for the sake of simplicity. Let’s say we put your home on the market with the price at the upper level of its market value. Only 10% of the buyers out there are going to even look at your home. Let me repeat that … only 10%.
On the other hand, if you price your home below market value, you’re going to increase the number of viewers (and potential buyers) to 75%. 10% versus 75% is a big, BIG difference.
Which would you rather have? 10% of the buyers coming to look at your home or 75%? My bet is on the 75%.
Now, this begs the question, what happens when 75% of the buyers are viewing your home? Potentially you will see more offers on your home which creates a bidding war, which can increase your bottom line and net you the most amount of money on your home.
Or, you can look at it like this. If you’ve ever sold anything on eBay you know that if you price an item too high then you only get a few offers, if any at all. But, if you start the bidding off at a lower price, there is often a buyer frenzy and the price can increase dramatically. This same concept works in real estate as well.
Why leave money on the table when you could be moving on to that next phase of life?
Do you want your home to sit on the market longer?
Or, do you want to create a frenzy for your home that draws people (ahem, buyers) to it?
My thoughts exactly. Price your home correctly and bring on the buyers!