An interesting trend appears to be occurring in the reader questions that I receive at the Tallahassee Real Estate Blog. In the past, most questions were submitted by homebuyers, and the questions were usually relating to the purchase of a home. But now, home sellers are starting to ask questions of their own. Hands down, their questions most often relate to the size of the margin for negotiation when determining the asking price of the home.
While a lot of factors go into determining the value of a home, invariably after the work is done, home sellers want to know how much margin for negotiation should be included in the asking price.
This is a universal question, and prior to an internet based MLS system, there were some very sound reasons why a home seller should ask for more than they planned on receiving. But with 94% of homebuyers using the tools on the internet when searching for a home, there are now valid reasons to eliminate the margin for negotiation when pricing a home to sell.
Sellers Should Eliminate Margin For Negotiation
As the real estate FAQ video addressed, property searches by home buyers utilize technology designed to eliminate homes that do not meet the needs of the buyer. The first criteria that a buyer enters will be price, and it is critical for home sellers that they do not eliminate their own home by being priced too high. A margin for negotiation only increases an asking price and potentially removes the property from search results of a ready, willing and able homebuyer.
Weaken Your Competition By Removing The Margin For Negotiation
I always advise home sellers that "Buyers choose a price range, but sellers choose their competition!" This basically means that home buyers will enter a price range to constrain their search. This will automatically eliminate every home seller who's home falls outside of that range, so the lower your price, the stronger you will appear in the search results. I'm not advocating asking a price below that which you will accept, just price it at the lowest number you will allow.
Most home sellers include a margin for negotiation, thus they price their home a bit higher than they expect to receive. This only serves to push their home up to a higher price range making the following happen:
In home searches, their home is compared to more valuable homes and thus is selected far less often
Their home does not appear in the price range in which they expect their home to sell
They get fewer online "visits" which results in fewer real world visits
When home sellers understand today's technical pricing strategy, they price their home at the lowest price they are willing to accept and then hold firm when they receive offers. If their home is truly the best in its price range, somebody will buy it at their asking price (it's not like there is a better buy out there, right?).
While a lot of factors go into determining the value of a home, invariably after the work is done, home sellers want to know how much margin for negotiation should be included in the asking price.
This is a universal question, and prior to an internet based MLS system, there were some very sound reasons why a home seller should ask for more than they planned on receiving. But with 94% of homebuyers using the tools on the internet when searching for a home, there are now valid reasons to eliminate the margin for negotiation when pricing a home to sell.
Sellers Should Eliminate Margin For Negotiation
As the real estate FAQ video addressed, property searches by home buyers utilize technology designed to eliminate homes that do not meet the needs of the buyer. The first criteria that a buyer enters will be price, and it is critical for home sellers that they do not eliminate their own home by being priced too high. A margin for negotiation only increases an asking price and potentially removes the property from search results of a ready, willing and able homebuyer.
Weaken Your Competition By Removing The Margin For Negotiation
I always advise home sellers that "Buyers choose a price range, but sellers choose their competition!" This basically means that home buyers will enter a price range to constrain their search. This will automatically eliminate every home seller who's home falls outside of that range, so the lower your price, the stronger you will appear in the search results. I'm not advocating asking a price below that which you will accept, just price it at the lowest number you will allow.
Most home sellers include a margin for negotiation, thus they price their home a bit higher than they expect to receive. This only serves to push their home up to a higher price range making the following happen:
In home searches, their home is compared to more valuable homes and thus is selected far less often
Their home does not appear in the price range in which they expect their home to sell
They get fewer online "visits" which results in fewer real world visits
When home sellers understand today's technical pricing strategy, they price their home at the lowest price they are willing to accept and then hold firm when they receive offers. If their home is truly the best in its price range, somebody will buy it at their asking price (it's not like there is a better buy out there, right?).
About the Author:
Learn more about getting a home sold. Stop by Joe Manausa's site where you can find out all about a progressive home selling plan and what it can do for you.
No comments:
Post a Comment