4 Tips To Set an Asking Price
When it comes to selling a home, one of the most difficult pieces of the puzzle is pricing. And for real estate agents, it can be one of the most difficult conversations to have with your clients.
Sellers don’t want to come in too low and leave money on the table, but they also know that they don’t want to price themselves out of the market, either. For sellers, this difficult situation can cause them to ignore the sound advice of their seasoned agent. It’s the real estate pro’s job to help clients find that happy medium between the right price that will get them the biggest payoff, be competitive in the current market, and leave them without seller’s remorse for parting with a home they love.
Here are four smart ways to help sellers understand what the right price is for their home and get them on their way to a successful sale.
1. Start with the data
Real estate is a game of trust. Agents need to trust clients, and clients need to trust their agent. These days, real estate consumers have access to more data than ever before. It’s a blessing and a curse. In many cases, this can be helpful, and clients can be proactive about educating themselves about the home-selling process. But it can also be confusing — and a potential source of conflict — when sellers see one thing online and are then told another by their agent. And that’s understandable.
Sellers need to remember (and be reminded) that real estate is a local game and can be highly nuanced. These factors can impact the price of a home and are often not captured in more general real estate data.
To combat this hiccup, smart agents will share the logic and data behind their thought process and be explicit as to how they arrived at their suggested listing price. Seasoned agents will be open and willing to address questions from their sellers and work through the math with them.
And, in turn, smart sellers will be open to hearing the why behind the pricing. A great sale depends on agents being confident that the home is listed at the right price and sellers being confident that they are getting the most money possible for their home.
2. Take a walk through the pricing criteria
While data and education can help alleviate some confusion over comps and a home’s list price, sometimes showing can be far more effective than telling. Set up a time to walk through other on-market homes listed at the price the seller thinks their home should be listed for. Together, look at the specific features or elements that push that home to the higher price point.
Then, set up a time to walk through the seller’s home with them. You’ll be able to examine the home’s nuances and unique features and talk about how it will impact the home’s price in relation to the bigger market. You can also discuss how things like upgrades and renovations, access to various schools and family-friendly areas might affect the home value.
3. Build a bidding war
Every seller has dreams of multiple buyers all competing for their home. Unfortunately, many times the biggest drivers of bidding wars — like school districts and market inventory — may be out of the seller’s (and agent’s) control.
But sellers who are set on giving themselves the best chance at building a bidding war would be smart to remember that there are two ways to make sure their home’s listing and showing has the highest potential to drive multiple offers.
•Staging the home. Spending the money to clear out clutter and have the property professionally staged can boost both curb and walk-through appeal. When buyers see a well-appointed home, the intrinsic value goes up compared to homes that haven’t been given this boost of visual TLC.
•Mention key selling points. Agents at the top of their game are already well-versed in how to highlight key offer-drivers. However, sellers should be proactive in sharing the little things that only someone who has lived in the home can really appreciate. Things like closets with smart organizational systems or specialty energy efficiencies can be surprisingly big selling features.
4. Setting aside emotional attachment
For sellers who have poured love into their home (along with some serious sweat equity), it’s easy to have those acts blind them when it comes to pricing their home. Homeowners put in the work, time and love, and they want their selling price to reflect those!
But the truth is, buyers seldom care that the old owners lovingly carved that bannister by hand (they just care what it looks like and whether it’s their taste). Remember, smart pricing will help the right buyer see themselves in the seller’s home. The goal of setting the right price is to bring in as many viable, healthy offers as possible. Assigning value based on emotional attachment can be the biggest selling sabotage of all. Sellers should love the home for what it was, hold tight to the memories and, ultimately, embrace the potential joy and life possibilities that can come from a successful sale.