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How Do You Properly Price a Home?
Set It, Sell It, Forget It
Darby Hiles
Overpricing a home does not increase the probability it will sell for more
Here Are the 6 Disasters that Occur When a Home is Overpriced
Time
Imagine yourself in two months time, your home still isn't sold even though it has been over a month, you've had dozens of showings and all the homes around you have sold at or above asking price. You're frustrated and do not understand why your home still isn't sold despite it being seen by every potential buyer in the area.
This is why, when your home first goes on the market, it should be very appealing and at a price point similar or even better than comparable homes in your area. If your home is not priced correctly, it may be ignored, or worse, noticed by buyers and placed into the "not worth it" category.
Now imagine more time goes by and it is now 6 months later and the market has completely changed, forcing you to take a price much much lower than what your home could have sold for when you first listed. This is the first problem with overpricing a listing and this is why a home must be priced correctly in order to be appealing when it first comes to market.
Stress
Keeping your home in show worthy condition is a lot of work, even if your home is usually neat and tidy. Your home must be in pristine condition in order to attract the highest paying buyers.
Clean floors, carpets, windows, kitchen, bathrooms, getting rid of clutter, landscaping etc. all must be maintained for your listing to shine. Would you really want to do all of this everyday for six months? Especially, when you could sell your home for more in the first two weeks than you would after 6 months. There is no need for all of this work, stress and constantly wondering when someone will want to view your home.
Selling your home should be fast, easy, stress free and profitable and not a single one of these is more likely to happen if your listing is overpriced.
Mortgage Payments
Every month that goes by, means more money that your putting into a house that you will never get back. Even with a low interest rate, you could lose hundreds if not multiple thousands of dollars in interest payments that most homeowners overlook when they go to sell their home.
With an overpriced home, there is no negotiating up and month after month if there are no takers you are losing more and more money.
When you price it right, you have all the negotiating power as you will have lots of interest, you cherry pick only the best offer and sell it fast and for top dollar.
Negative Perception
A shift in the buyers attitude that causes serious headaches and loses you a significant amount of money.
The longer your home sits on the market, the worse the perception becomes. As a home creeps farther and farther past the average selling time/DOM in the area, the less a buyer will want to pay, the less interest there will be in your home and the more "low ball" offers you will receive.
When your home first goes on the market, it receives the most attention and it will be considered by a number of buyers so long as the price is comparable or superior to others.
Low ball offers are frustrating and even upsetting, you know that your home was worth more than these offers but they see you as an easy target and are ready to take advantage of you. Low ball offers can be avoided by pricing your home advantageously which will generate significant demand, attention and dollars.
Appraisal Problems
Even with an offer, you could still be in trouble. Sometimes you may get lucky and a buyer will agree with your optimistic price if they see something special about your home.
However, in order for the buyer to get a mortgage, a bank will require a home appraisal. The appraiser will use prices of homes that are comparable and have sold near yours. If your price is too high, not only can it cause a delay but it can actually result in a lender that will not provide a loan on the property.
As you can imagine most buyers won't be eager to shell out more money once the bank decides that the home is not worth that much.
Distribution Problems
Pricing your home too high can result in hundreds and even thousands of potential buyers not receiving or viewing your listing.
Most buyers use the internet as their initial search for a home, even though your listing will be on hundreds and even thousands of sites it could still not be seen by the most likely buyers. As you likely know, searching online involves imputing a set criteria, if your home is outside of their selected price range than they will never see your listing and you won't have anyone to negotiate with even if you were willing to sell for less.
Darby Hiles- Broker
(705)984-5760
darbyhiles@gmail.com
Sutton Group Incentive Realty Inc., Brokerage
"Kind people are my kind of people"
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What Do Clients Think of Darby Hiles?
"I just bought my second house with Darby. Incredible human, incredible realtor. Darby sets you up with your own private dashboard where he posts the showing time, listing, and comparable properties of each house you go to see; that is so very convenient. You will get emails of all the properties that meet your requirements; your requirements are filters in an automatic system so you receive emails when something goes up on MLS, this means you hear about new listings immediately. If I asked to see a place Darby would get me in to see it usually next day, like as soon as possible. I was serious about finding a house and Darby read and matched my energy. Darby and I are both the age that prefer texting over phone calls, so our communication was only texting and emails. I'm sure if you wanted calls Darby would do that, but if you don't he is on board and capable to communicate that way. Darby is very no-pressure, he very clearly wants you to love the home you buy. There was a small hiccup and the first place I made an offer on was outbid, Darby came back the next day and apologized to me then offered a new plan for how we would proceed in the future. That really impressed me. I 100% recommend Darby for all your realty needs."
- Rachel Brocklebank (In her late 20's, multi repeat client)
"Darby, I can't thank you enough for being involved in the sale of my home. Not only was it sold faster than I thought it would be it was sold for above asking. Your standard of excellence made all the difference . So much time and effort went into the sale and I thank you for everything you did to make it happen."
- Kelly Haslan (Older single lady that needed help and wanted to sell fast)
"Darby is absolutely amazing!! He is very knowledgeable, personable, organized and extremely hardworking!! Darby went above and beyond my expectations of a realtor!! His referral program gives back to the community and that shows his humility!! Darby’s excitement and goodwill is shown through his work!! Let him sell your house!!"
- Tracey Pletz (Single mom that wanted to sell fast)
"Darby Hiles was an excellent agent to work with. From listing our property and getting it ready to closing the deal Darby was very helpful, knowledgeable and responsive. I would highly recommend him."
- Patricia Quinn (Investor that wanted to sell for as much as possible)
"We were interested in learning about real estate so we enlisted the expertise of Darby Hiles. He was very pleasant to deal with and set us up to receive the information on the available listings. He followed up regularly via text and answered calls if I preferred to speak live. Darby knew the area well and ensured he sent us what we were looking for. Although we did not proceed with any purchases, he was a great resource and easy to work with. If we had an opportunity to purchase I might have given him 5 stars but we didn't experience the process from end to end (which is why I gave him 4 stars). Based on my experience I would recommend Darby if you are looking for real estate in his areas."
- Sherrin Pacione (Investor that wanted a new deal)
"Darby will not pressure and coax you into buying any old house; he wants you to be 100% absolutely positively certain. He wanted to hear me say "yes, this is the house" before we proceeded with the offer. If I ever sell or buy another house I would not hesitate to go with Darby again."
- Rachel Brocklebank (In her late 20's, multi repeat client)
"Darby was a fantastic realtor. He was very professional and went above and beyond for my family. He is great at is job and gets to know his clients on a more personal level. He truly loves his career and it shows. Thank you for everything Darby."
- Katrina Cormack (Off-market Seller)
"Darby was very helpful in our search for a new home in the area. Good attention to detail and very attentive to our needs. Found us a home that fit our needs perfectly in a very difficult market."
- Chris Chapman (Off-Market Buyer)
"Darby helped my family and I find the perfect home in a great community. We’re very happy with the service he provided and our new home. Also, within 9 days of working with Darby he found me a power of sale property for $26,000 under market value"
- Dan Rea (First Time Buyer with Family)
"Darby is amazing in not only selling my home but finding me my new dream home. He puts everything into perspective and really helps you find the home that you will love. He is sincere about his professionalism as well as finding something you would love. Would definitely use him again"
- Gab Quinn (Hard Working, in her 30's)
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