When the price is right, the house sells, in the experience of Ryan Gehris, broker of record for USRealty.com.
And by the ‘right price,’ he doesn’t mean an asking price that’s too low. He’s talking about the sweet spot –the price that ‘feels right’ to potential buyers and their agents, based on recent and pending sales in your neighborhood.
Find the right price with these three proven strategies (and find more at the USRealty.com resource center):
- Invest in research. You can order recent sales data from USRealty.com; scour local home sales data available from public records; and track reports from your local multiple listing service (MLS). (Most USRealty.com customers decide to list their houses in the MLS, which feeds listings to large supersites like Zillow, Realtor.com and Trulia.) What not to do: collect sale prices from your neighbors and add 5% or 10%. Buyers and their agents are armed with the latest data. Use the same datasources to support your asking price and your negotiation will be off to a strong start.
- Price in round numbers. “$201,000 is an awful price,” says Gehris. That’s because buyers tend frame their searches in terms of round numbers. At $201,000, the house will be overlooked by buyers searching for houses in the $150,000 to $200,000 range.
- Know that if you must drop the price, it will likely start with a 3% reduction. That’s what it takes to restart interest in the house and get buyers looking at it again, says Gehris.
Ask yourself these three questions to ensure that your asking price is spot-on:
- What sale prices did the last three most similar MLS sales bring?
- What is the offering price(s) of current listing(s) for sale that is your toughest competition?
- In what price bracket are your buyers searching?
How will you know if your price is too high?
Well, you won’t have any offers. That’s the biggest clue. If potential buyers are working with agents, you might get questions about the rationale for the asking price from agents, but don’t count on it, says Gehris. “They don’t want to pick a fight when there are other properties for sale,” he says. “Most price reductions result from sellers simply seeing little to no interest in their listing.