High price might backfire
Q : I’m getting ready to sell my house and I remembered you said houses can jump in value even in a buyer’s market. Should I price my house higher than recent sales and see if I can get more? I really want to make some money on it and the value my broker is telling me seems low.
A: We all want to get as much as possible for our houses. For most of us it’s the biggest purchase we’ve ever made and it’s painful when it’s worth less than we wanted. But you can’t affect the value just by pricing it higher.
There are lots of houses on the market priced too high. They’re not selling. Value is exclusively determined by what a buyer is willing to pay for it. We arrive at that number by looking at recent sales of similar houses. But you do have some control.
There are things you can do to improve the overall appeal and often purchase price of your house: fresh paint, new curtains and/ or blinds, landscaping (in particular improving curb appeal), updating or installing ceiling fans, new carpet or flooring, remodeling kitchens and baths… Basically, if you improve the condition of your house, you can increase value. So, talk to you broker about what would have the largest impact with the smallest investment. Look closely at the comparable properties and at the competition. Are there places where you can invest some money and improve the overall look of the house? Every little bit helps.
If you are determined to list the house high, you must be prepared to lower the price as needed.
Let’s assume you have great photos, the house is clean and decluttered, and easy to see. If no one comes to see the house within a week or 10 days, the price is too high. Lower the price immediately and see what happens. If you don’t get any offers after about 10 showings, and you do get feedback about the “high price,” lower the price again.
With all of the reductions, you need to be sure you’re willing to sell at market value. There’s no point in listing your house if you’re not prepared to go down to the most likely sales price. You’re just wasting your time and everyone else’s. You might just have to wait a while longer for the market to turn around. Maybe rent the house. Stay longer than you’d planned.
No one likes to hear their house isn’t worth what they think. And lots of sellers say, “How do we know if we don’t try?”
But remember, your broker wants the exact same thing as you: to sell your house for as much as possible. Don’t you think if the market indicated a higher price your broker would recommend it?
So look at the situation critically. Be honest with yourself and your broker. Be clear about your bottom line. Then make the decision that best meets your needs and is actually likely to yield results.