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Common Pricing Mistakes

There is no denying that in today’s tough market, some homes are struggling to sell. If your property has been on the market for a couple of months with little interest, or if you’re thinking of placing your home on the market, it is important to be aware that price plays a huge role in the timely sale of your home.

Here we list a few common pricing mistakes to avoid when selling your property.

Being unrealistic

Some homes are overpriced right from the beginning. It’s obvious that you want to yield the highest price for your property, but of course, you actually want to sell it, and in order to sell your home, the price needs to be right.

If you want to make sure that your property sells, you have to price your home with a realistic sale price. If you are not accurate with the price, your home will likely remain on the market over time without any new buyer offers being made. To ensure you are pricing realistically, it is important to work with an agent who has extensive knowledge of your area and the current market.

Chasing the highest price

It is only natural to want to get the highest profit from selling your home, however, this doesn’t always work well. It is likely an unrealistic dream which will end up wasting your time and money.

Remember, as you are selecting the right real estate agent to work with, don’t base your decision on the agent who promises you the highest sale price. Your choice should be based on the agent’s familiarity with your local area and their sale history. You could even ask an agent how they came about estimating that particular price, and how they will market your home to ensure you can achieve a price as close to their estimate as possible.

If you opt to have more than one appraisal conducted, ensure that your decision is not based on the highest valuation presented to you. Instead, use the two figures to look at the bigger picture. Did one agent blow the other out of the water with a much higher figure? In many cases, this could be because they were unfamiliar with the area, and unsure of what your property is really worth. Sure the higher figure sounds more appealing, but choosing an agent based on their high valuation, and consequently, listing your property at an inflated price, runs the risk of your home remaining on the market until it expires, which will not work in your favour.

Don’t let your listing expire

With your home on the market for a few months and no sale, people might start to wonder what is wrong with your property. If you then opt to hire a second agent who then lowers the price, this will only confirm onlookers’ speculations. This could lead to even less attention for your property, a low turnout for inspections and several more months without any sign of sale.

At this time, it is likely you will be completely over selling your home, and will probably accept the first offer you receive which is likely to be far below what your property is worth! This shows the true importance of a correctly priced property.

Pricing your property too low

Contrary to popular belief, it’s not really possible to price a home ‘too low’. Homes sell at a price a buyer is willing to pay and a seller is willing to accept. Competition is a great price driver, so if you do price your property too low, chances are, the price of the surrounding homes will draw attention to your “bargain” property. This will generally result in multiple offers which can be played off one another to lift the price. 

It is very important for you to understand the market value of your property before you contemplate selling. You may have a ballpark idea of the home’s worth in your mind but this is not what will matter to a real estate agent or buyer. In order to price your property correctly, you must take into consideration your neighbourhood and the prices other homes in your area are selling for. Also, you should be reviewing the condition of your home and whether any damage or wear and tear has lowered its value.

Take a look at what your home has to offer in relation to other homes in your area - perhaps your home has a swimming pool, an extra bedroom or a home theatre? Adjust your price in accordance with these features to get a rough idea of your home’s value. This way you also have an estimate of what a real estate agent might value your home.

Keep in mind, you should also keep an eye on general supply and demand in your area, as well as the current state of the property market to gauge further what price is realistic for your home. Our advice is to listen to the experts! To have a free appraisal conducted on your home by one of our experienced and knowledgeable sales associates, visit www.peard.com.au to find your nearest Peard Real Estate office.