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How to Properly Price Your Property To Sell

How to properly price your property to sell

When selling your property, one of the most important considerations is the price!  This relates to what price we will list our property for sale and at what price will we ultimately sell!  With some careful planning you can help ensure you get the highest possible price in the current market.

 Tip 1 – Do your homework

Your homework should include seeking recent sales of similar properties in your immediate area. Companies such as RP Data and Australian Property Monitors can provide reports on property sales, but remember to only compare against “similar” properties in your immediate area.

You should also consider comparing properties that are currently on the market. These asking prices will also give you an indication of what range you should be setting your asking price at.

While doing your homework, remember to compare “apples with apples”. If you own a 3 bedroom townhouse with 1 bathroom, don’t compare your property to a 4 bedroom free standing property with 2 bathrooms. The asking and selling prices can be vastly different.

Tip 2 – Get a Minimum of 3 Market Appraisals

Part of your research includes seeking out potential agents to help you market, negotiate and sell your property. When considering price it is important you speak with local real estate experts.

Sale prices for properties can differ even within the same suburb (think of properties with water views versus those that don’t). Properties in certain streets and with certain aspects can obtain vastly different prices, and a good real estate agent will advise you if this is the case in your area.

After an agent inspects your property and presents their appraisal, they will provide an opinion of a likely selling price range. This range will give you an indication of what the market is willing to pay as a minimum and what it is likely to pay as maximum price.

When you have your 3 Market Appraisals, the numbers should be starting to give you an idea as to a likely asking and selling price.

Tip 3 – Engage an Agent to Market, Negotiate & Sell Your Property

Selecting the right agent to promote and sell your property is very important. As a vendor you need to have faith and trust in your agent. Honest open dialogue between both parties is important in reducing the stress during the sale of your property.

An open, honest discussion with your agent about pricing is paramount. A worthwhile exercise in discussing price is to look at all comparable properties (sold and for sale) and do a better-or worse scenario. Look at each property on its merits and determine whether your property is better or worse than each for sale or sold property. By doing this, you should start to arrive at a fair selling price!

The goal during this exercise is to be realistic and if you take the advice of your agent, you will get a good understanding of the current state of the buyers’ market. It is highly unlikely that any buyer will pay more than what the property is worth.

It can be tempting to try and test the market to see if there is a buyer who is willing to pay more than “current market value”  However, if you over-price your property for too long you run the risk of having your property sit there with all the other over-priced properties which can’t sell either!

Buyers will ignore properties that are well above market value. Eventually, this is where the “blame game” starts with the vendor blaming the agent and the agent blaming the seller for little to no inspections and zero offers.

Tip 5 – Price Your Home to Attract Buyers

Setting an asking price higher than fair market value to try and eventually negotiate down is not a worthwhile strategy. Many buyers will disregard your property altogether and there will be no-one to negotiate with!

It is recommended to list your property’s sale price slightly under the actual market value to attract immediate attention and multiple offers. This strategy could in fact drive up the eventual sale price by having multiple offers from interested buyers.

Don’t under estimate buyers, they are savvier today than they ever were. Research shows that most buyers will thoroughly research the market online prior to inspecting a property. This is where setting a realistic price is so important. Failure to set your price correctly will determine whether buyers are interested in an inspection. Buyers want to see value and will generally not spend more than they need to on a property purchase.

Tip 6 – Still Unsure, Get a Valuation

After having done your research and interviewed your 3 real estate agents, if you are still unsure, you may like to organise an independent property valuer to give you a valuation. A valuation is different to a market opinion (or appraisal) and indicates what the property is worth “today”!

A valuation should provide you with some confidence in setting a realistic asking and selling price.

source irealty

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