Price Your Home Correctly

Des Moines real estate values

It very important to price your home close to market value when you decide to sell . Overpricing your home in the beginning can sometimes cause your home to sell at below market value . That sounds contradictory, but it can happen for several reasons. 

If your home is priced higher than comparable homes in the neighborhood, you will get fewer buyers looking at it.  Buyers that do decide to look at it will sometimes use it as a comparison, to justify their decision to purchase a different home.  Their reasoning is “See…..this is a similar home to others that we have looked at but it is lot more expensive. We should buy the one we looked at yesterday—it’s a bargain compared to this one.”

A common mistake is pricing the home higher in the beginning to “test the market”. The thought is “we can always lower the price if we don’t receive any offers.”  Unfortunately most of the showing activity occurs when the home is first listed. Once intital pool of  buyers have seen the home and it doesn’t sell, the sellers will then have to wait for new buyers to come into the market.

The longer your home remains on the market, the less interest it will generate among buyers. Buyers typically feel that they should pay less for a home the longer that its been on the market.. At that point  you have to face the real possibility of being forced to sell it for less than if you had priced it at real market value. It is especially important to make sure that your home is priced correctly when the conditions are leaning towards a buyers market. In that scenario buyers are very sensitive to price and will look harder to find homes that offer the most value.

Many times sellers feel that they should  price their home higher in order to allow some room for negotiation. Buyers always assume there is negotiating room. If your asking price is higher than comparable homes, they will just assume that they can negotiate a similar discount on the lower priced home.

Overpricing is not the only pitfall that sellers can  fall into when it comes to pricing their home, some sellers will under price their home. The best insurance against this is to get a Comparative Market Analysis (CMA) to see what similar homes are selling for, what competing homes are listed at and what are the local market conditions as related to their area, style and price-range.

Pricing your correctly  will save you a lot of time, aggravation, and money.