Pricing Your Home To Sell In Colorado Springs
Pricing your home to sell is the number one way to get more buyers in the home and an offer quicker.
We recently went on a couple of listing presentations where the sellers were not realistic with their price. Their argument was “we need to get the most out of our house, we aren’t going to give it away.”
We totally understand their position, but they need to understand ours as well. We aren’t going to list a home that is overpriced and will not sell quickly. Remember, our job is to SELL your home, not just market it.
Don’t get me wrong, we come prepared for every listing appointment with strong market statistics for the neighborhood where the home is located. At a minimum, we show the seller comparable properties for:
- Actives to understand their competition
- Under contract and pendings, so they have a feel for what price range buyers are looking and if there is any shopping
- Solds for comparable properties to see the actual sales price with any sold concessions, i.e., properties used by an appraiser
All these properties are shown with price per total and finished square foot, original list price, and days on market.
Understand the Market
In addition to this information, we also provide the big picture; a) the number of homes in their neighborhood that are currently on the market, b) under contract, c) pending and solds that aren’t necessarily their competition, d) average days on market, and e) distressed or new construction that may impact the local market. We calculate an absorption rate, which is the number of months it would take to sell the current inventory of homes based on the current sold properties per month. This gives the sellers an idea of how long they can expect to be on the market. All this information allows the seller to understand the market across the board for their neighborhood.
Some would argue it is an information overload, but we feel strongly that if a seller is going to jump into this market, they need all the information available to make an informed decision, particularly where they should price their home.
Pricing even a small amount above the competition “to get the most out of our home” can be a huge mistake. If the price of the home is “out of the market” the number of showings for the property will be low. Statistics show that the most activity on a home is in the first three weeks the home is on the market. In order to get back into the market, the property may need to undergo drastic price reductions.
Additionally, we have learned from experience, as buyer’s agents, that homes that are overpriced are used to sell the homes that are properly priced. In other words, if you have two comparable properties, the home that is priced reasonably will sell faster because the buyer will see both properties and determine on thier own that the seller of the higher priced property is unreasonable and probably will not negotiate down to market value. Remember, market value is the price a buyer will pay for the home.
Another problem with pricing too high, even if you find a buyer willing to pay your price, your property still has to appraise. We have used this strategy successfully for our buyers in the past. They agree to pay the seller’s price for the home, but the property doesn’t appraise for the sales price, so the seller is forced to come down on their price in order to sell.
So the bottom line is when pricing your home to sell, sellers need all the information available to make an informed decision. This is not the time to “test the market” if you truly need to sell.