Which pricing strategy leads to the best results when selling your house?
Do you price high, low, or right at the market value?
Hi it’s Eva LIn, #1 Realtor for Pasadena home sales in 2023, 24, and 25.
Choosing a listing price is among the most important decisions made during a home sale.
Pick a number that’s too high and you could drive serious buyers away.
Pick a number that’s too low and you might end up leaving a ton of money on the table.
So, what’s the right approach?
As you probably guessed, it all depends on your house.
For today, I’ll just focus on when it’s best to price below the market value.
The situations when you want to price at or over market are more complex, so I’ll cover those in a future video…
Now, pricing low is usually the right strategy when a few different conditions are in place.
First, there needs to be a solid pool of buyers who’ll be interested in your house.
That’s because the enticing list price is meant to attract multiple offers…and the more you receive, the better.
Second, there needs to be clear market data on recent home sales that are comparable to yours.
Even better is when there are comparable homes that are currently for sale.
A strategic listing price allows your house to look more appealing than the competing houses and, in doing so, create your own competition among buyers.
When executed properly you don’t need to worry about leaving money on the table.
That’s because the interested buyers will bid your home’s price up to its maximum market value.
Sometimes, when the bidding becomes particularly intense and emotional, the final sale price will go beyond the expected market value.
Another benefit of this strategy is that it puts you, the seller, in a very strong negotiating position.
You’ll be able to dictate the terms of the sale in your favor when the buyers know that they’re not the only game in town and others are eager to jump in and win the house.
At the end of the day, there’s a lot to be gained by the seller who receives multiple offers.
And you can engineer this by selecting an initial offer price that’s enticing.
In other words, a price that’s a bit below the market value.
I hope this was helpful and next time, I’ll share about when it’s best to use a different strategy.