Before you list your home on our website, I invite you to talk with me about how to price your home. Every market cycle is different and within each cycle things change.
There are free on-line pricing websites such as Zillow. But, Zillow does not adjust for property values that fall outside their pre-determined pricing algorithm.
I recommend a combination of 3 pricing strategies:
- Search Realtor.com for homes in your neighborhood and see where your competition is priced.
- Call a Realtor® or two and have them give you a traditional CMA (Comparable Market Analysis). This is the value they use to suggest a listing price. This approach uses “closed sale data” from the MLS (Multiple Listing Service). One downfall is it doesn't take into account if the seller paid some or all of the buyer's closing costs which could reduce the sales price by up to 6%. Another issue is the possibility that a short sale and bank owed (REO) property used in the CMA will drive down your CMA value. Short sales and bank owned properties will be used in the appraisal process but do not necessarily represent your competition because some Realtors® and buyers will not approach a short sale.
- The best way to price a home is by testing the market with a price. See the reaction from Realtors® and buyers. When you list you home with the ADDvantage® Real Estate Network, our system sends each Realtor® an email–the day after they show your property–requesting feedback. Use this feedback to fine tune your price. Next, consider my pricing theory that works well in troubled areas of Florida such as Miami, Orlando, Naples and Ft. Myers. I call it “How to win the sale and not give your home away.” Here are my thoughts…
First, save 3% in real estate commissions by listing flat fee in the MLS and pass this savings onto the buyer. Next, appeal to the greed of the Realtors® by creating competition by pricing it at a level where Realtors® scramble to be the first one to sell it and earn the commission.
I know my price theory works because I have helped 100's of sellers get their properties sold even in this challenging market. I also understand the motivation of the Realtors® as I work with them everyday, negotiating contracts for our hybrid flat fee MLS plan, ADDvantage PLUS™.
My belief is that in this buyer's market, buyers are only willing to pay market prices or slightly less than market prices to compensate them for the possibility of lower prices.
Sellers are only willing to sell if they receive a price that they feel is not giving their property away or may have other restraints such as mortgage balances!
To create excitement about your listing in the MLS, list your home at your bottom line price! This pricing strategy narrows the gap between what you want and what the buyer feels is a good deal. It also generates more showings.
The reason this pricing strategy works is because it gets the Realtors competing against one another to be the first one to sell your home and earn the offered commission. It is always about the money!
Often, by leaving no room to negotiate, Realtors® or buyers will bring you a full-price offer or very close to it.