The Asking Price

house.price tag4The biggest mistake made in real estate is poor pricing.   Pricing a home is best done by specialists who have all the necessary tools.  The asking price must accomplish three primary goals.

Pricing with the Competition  In the final analysis, it is the buyer who will determine what your home is worth.  Buyers learn value by inspecting and comparing similar homes that are for sale.  If your home is not priced in accordance you will in fact be helping to sell a home that is similar to your own.  When attempting to price your home with the market, don’t rely on hearsay or rumor about recent selling prices. Get the facts by asking your Realtor for a Competitive Market Analysis (CMA).

Pricing to Negotiate  Traditionally, most buyers expect to negotiate.  Everyone likes to think they got a “deal”.   In order to satisfy this need to negotiate, you should price your home so that you will be willing to accept somewhat less than the asking price.  Although market conditions will affect the amount of negotiating, most homes sell within 5% of the asking price.  In a poor market this percentage will be larger and in a strong market you will experience an offer that is closer to the asking price and sometimes above.

Pricing for the Highest Return  Although pricing for the competition and for negotiation are important, the asking price must deliver the highest financial return for the seller in a reasonable period of time with the least inconvenience.