My “GET YOUR HOME SOLD QUICKLY” MARKETING PLAN

Pricing

Price is the single most important factor to consider in getting your home sold.  Overpricing leads to a stale listing. Buyers will wonder what is wrong with a home that has been sitting on the market for several weeks or months.

Pricing  below fair market value often generates multiple offers resulting in driving up the price to market value or higher than list price even in a slow economy because of the law of supply and demand at that price, for that product [house].

How much your house is worth?  You want to be careful not to overprice the house because an overpriced listing will not sell anymore than an overpriced laptop or gallon of milk will not sell.  This results in a loss of the freshness of the excitement of the home’s initial newness and appeal which can happen in a short period of time, even after the first two to three weeks of the initial list date. After 21 days of sitting on the market with no activity, demand and interest wane.

The natural law of supply and demand really works.  Just like when buying lobster in a restaurant.  The price fluctuates according to current market demand.  Therefore, don’t worry about pricing it too low because homes priced below market value often will receive multiple offers, which will then drive the price back up to market value as the market seeks equilibrium between supply and demand. Pricing is all about supply and demand. Pricing a property is part art and part science, and no two agents price property the same way. It is really a matter of opinion based on hard “sold” data, condition of the house and location of the property. Other factors may include future plans for the area, school system and whether or not the home is “stigmatized” in some way due to something unpleasant occurring on the property sometime in the past.

Pull Comparable Listings and Sales

• Look at every similar home that was or is listed in the same neighborhood over the past six months.
• The list should contain homes within a 1/4 mile to a 1/2 mile and no further, unless there are only a handful of comps in the general vicinity or the property is rural.
• Pay attention to neighborhood dividing lines and physical barriers such as major streets, freeways or railroads, and do not compare inventory from the “other side of the tracks.” Where I live in the Land Park neighborhood of Sacramento, for example, identical homes across the street from each other can vary by $100,000. Perceptions and desirability have value.
• Compare similar square footage, within 10% up or down from the subject property, if possible.
• Similar ages. One neighborhood might consist of homes built in the 1950s next door to another ring of construction from the 1980s. Values between the two will differ. Compare apples to apples.

Sold Comps

• Pull history for expired and withdrawn listings to determine whether any were taken off the market and relisted. If so, add those days on market to these listing time periods to arrive at an actual number of days on market.
• Compare original list price to final sales price to determine price reductions.
• Compare final sales price to actual sold price to determine ratios.
• Adjust pricing for lot size variances, configuration and amenities / upgrades.

Withdrawn & Expired Listings

• Look for patterns as to why these homes did not sell and the common factors they share.
• Which brokerage had the listing: a company that ordinarily sells everything it lists or was it a discount brokerage that might not have spent money on marketing the home?
• Think about the steps you can take to prevent your home from becoming an expired listing.

Pending Sales

• Since these are pending sales, the sales prices are unknown until the transactions close, but that doesn’t stop anybody from calling the listing agents and asking them to tell you. Some will. Some won’t.
• Make note of the days on market, which may have a direct bearing on how long it will take before you see an offer.
• Examine the history of these listings to determine price reductions.

Active Listings

• These matter only as they compare to your listing, but bear in mind that sellers can ask whatever they want.
• To see what buyers will see, tour these homes. Make note of what you like and dislike, the general feeling you get upon entering these homes. If possible, recreate those feelings of reception in your own home.
• These homes are your competition. Ask yourself why a buyer would prefer your home over any of these and adjust your price accordingly.

Square Foot Cost Comparisons

• Remember that after you receive an offer, the buyer’s lender will order an appraisal, so you will want to compare homes of similar square footage.
• Appraisers don’t like to deviate more 25% and prefer to stay within 10% of net square footage computations. If your home is 2000 sq. ft., comparable homes are those sized 1800 to 2200 sq. ft.
• Average square foot cost does not mean you can multiple your square footage by that number unless your home is average sized. The price per square foot rises as the size decreases and it decreases as the size increases, meaning larger homes have a smaller square foot cost and smaller homes have a larger square foot cost.

Market Dependent Pricing