Pricing right for today's market
Listing 'under market' not always effective
By Dian Hymer, Monday, April 13, 2009.Pricing too high can be the kiss of death for home sellers in today's market. Many buyers are sitting on the fence, waiting to see what happens with the economy, and hoping that home prices will drop further.
On the other hand, the recent uptick in home-sale activity confirms that low interest rates coupled with lower home prices have many buyers convinced that they should buy now. But, they are looking for bargains.
There is no great sense of urgency to buy now. Interest rates are enticing, but low rates are likely to be around for awhile. An $8,000 tax credit is available for first-time buyers -- which includes those who haven't owned a home in the last three years -- if they buy between Jan. 1, 2009 and Nov. 30, 2009. This will hopefully have a positive impact on the housing market. However, the effect will probably be modest.
Homes that sell in this market have several things in common. They are well located, in good condition and show well. And, they are priced right for the market.
The most profound effect you can have on the sale of your home is your choice of list price. Recently a seller listed his Oakland, Calif., home for $47,000 less than his agent's recommended list price. The under-market price generated a flood of showings and six offers. The listing sold for significantly more than the list price.
HOUSE HUNTING TIP: Some sellers think that the way to get the highest price is to list their home for considerably less than market value. In hot spots in the housing market, this strategy often brings good results. However, if there isn't much sales activity in your area or in your price range, this approach could result in disappointment. You should list at a competitive price, but one that you'll be willing to accept if you don't receive multiple offers.
Many sellers understand the importance of pricing right for the market. But, they don't want to price so low that they leave money on the table. You can keep this from happening by making sure your listing receives comprehensive market exposure -- Multiple Listing Service, Internet advertising with photos, an open house for agents and an open house for the public -- before accepting an offer. ...CONTINUED
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Submitted by Elizabeth Bolton on April 13, 2009 - 1:43pm.
This is great advice. Pricing is not easy nowadays. There are segments of the market in my area that are more likely than not to generate multiple offers. In that case I find that having an announced time to review offers is very helpful since we know what to expect for our buyers. I'm often hesitant to put that in MLS - it can be an easy way to get egg on your face or, as you mentioned, be a turnoff to buyers.