Your Secret Number

Your Home Selling PriceI know, it’s tempting to start out with a higher asking price for your home, thinking that you’ll accept a lower price if someone makes you an offer… or that you can always reduce your asking price if it doesn’t pan out.

But here’s one big reason why you shouldn’t start out high: You’ll immediately eliminate a good portion of potential buyers who won’t even consider your house if it’s over the threshold they want to spend.

Buyer’s think in ranges, such as $200,000 to $249,000. If you price your house at $255,000, all the people looking at the “under $249,000″ range won’t even bother with your house at all. There’s probably enough inventory in their desired price range, so why spend time looking at houses that exceed that threshold — even by a dollar.

In the meantime, your slightly-overpriced house gets stale on the market, and you end up reducing it anyway. But you’ve lost valuable time and if the market moves lower, you’ll end up having to reduce your asking price even more.

So your best bet is to price your house to appeal to the largest number of buyers within a price range, instead of keeping a secret number in your head where you’ll consider selling it. I know, it’s painful, but wouldn’t you rather celebrate the successful sale of your house than to keep cleaning it for buyers who aren’t coming?

Want more tips on making people fall in love with your house? You can download the Home Seller’s Blues eBook instantly!  Now also available on Amazon’s Kindle and at the Applie iBook store for all your Apple devices.

Did you enjoy this post? Why not leave a comment below and continue the conversation, or subscribe to my feed and get articles like this delivered automatically to your feed reader.

Comments

I deal with this everyday from my sellers. It is such an emotional issue for them. As they claim they need “wiggle room” for negotiations I remind them that without an offer, wiggle room will do you no good. Pride really gets in the way at times and it is hard to be the bad guy talking about price reductions.

Julie, this is so true that pricing can be an emotional issue. I think part of it is that home sellers can identify themselves with the price of their homes, so if they lower their home price, it’s as if they are lowering the price they are worth. So it’s important for home sellers to realize that what they are “worth” as a person has absolutely nothing to do with their home price.

Great article. We are currently having the condo sellers blues…already dropped our price 20K and that is 14K less then what we bought for. And reading this article I think we need to get into the 200 – 250K range…we are just above it. We haven’t had one showing in months even though we keep dropping our price. Thank you for the insight!

Thank you Thomas for your comments. A price drop under the $250K range may open you up to a number of new, possible buyers. Because there is such a high inventory on the market in many areas, Realtors often use a buyer’s exact price ranges to target what properties to show them. (If a buyer is looking for a property up to $250,000, they may not consider showing a house that’s asking $254,000 — because there’s already so many good ones in the “under $250K range” that a Realtor can show them.)

I’m all about the pricing it right, but seller agents, please keep in mind your client’s have a price they cannot go below without bringing money to the table. It’s important to discuss this with them BEFORE placing the home on the market. They can decide if they truly should put their place on the market and you can decide if you want to be the agent of someone who won’t go below a certain price. If you decide to proceed, make sure you have a defined pricing stragedy before listing the property.

Could be the most influential post I read all week!!!

Elsie

This is true. This is why a number of underwater sellers I know are opting to rent their places out and live somewhere less expensive (such as their mother’s house), rather than sell.

Great writing! I want you to follow up on this topic!

Kind regards,
Mark

Leave a comment