Posts (RSS)
Main | Do Not Expect Buyers to Pay for Home Improvements »
How to Price Homes in a Sluggish Market
By admin | May 28, 2008
In the housing market, it is all about the price especially for a buyer’s market. It is given that when a market is favoring the buyers, selling a home even one that is in the pre-foreclosure stage will be downright challenging. Very few sellers receive offers unless they have managed to price their property correctly. As the property continues to stay in the market, its value diminishes. And if the seller is looking to sell the property before the re-instatement period is over, then it could get really frustrating.
As a seller, you must be able to price your home based on tomorrow’s prices. This only means that you must be aware of market trends. For example, if home prices have been declining in the past year, you must be able to adjust your asking price accordingly. You must be able to price your home in such a way that they will be among the reasonably-priced properties.
In order to determine whether you have priced your pre-foreclosure home just right, you can observe how many buyers made offers during the first 21 days. If there were many visits but no offers, you can assume that the asking price is at least 5 percent above market. But if there were very few interested buyers, then your price is 10 percent above market. You should know that most buyers are actually willing to negotiate within the 5 percent price range but not the 10 percent.
If you think that you priced your home just right, you could always explain to the buyer how you reached that amount. You can also ask the seller how he arrived at his bid amount. This way, you will have a clear perspective during the negotiation.
On the other hand, If you have a broker, then your broker must be able to explain to you how he arrived at the current asking price. If you are willing to cut it in order to attract more buyers, let your broker know.
Topics: Homes for Sale, Pre Foreclosures |