The Pricing Trick That Impresses Buyers

“How did you get your asking price?”  Almost every person that came through our home asked us.  It was a fair question.  When buyers look at homes that are sold by owner, they may wonder how fair or accurate your pricing is.  If they have been looking at homes for any length of time, they will be “mini experts” in their price range.  They can’t be convinced what a great deal a home is.  They’ll know it when they see it.

It’s very common for home sellers to get pricing ideas from real estate agents.  It’s also a mistake; here’s why:  Agents are not impartial.  They have a  commission at stake.  They also have unique marketing styles.  Some agents will use higher values to “earn” a listing.  These listings sit on the market and age as the price slowly gets dropped.  Some agents undervalue homes for a quick sale and a fast commission.   Some agents can accurately nail that price in the “sweet spot” between too high and too low. Unfortunately without inside access to agent sales and pricing statistics there’s no way for a homeowner to know if the agent they are talking to is any good at valuation.   One of my clients called to share his experience.  He had four agents give him a free market analysis.   The lowest one was $350,000.  The highest was $450,000.  The two in the middle weren’t even close.  ”Who do I believe?” he asked.

There is a way to get accurate information about your home’s value.  Use a certified appraiser.  Appraisers don’t have a financial motive to price your home anywhere but accurately.  They have the training, experience and data to be able to calculate exactly how much it devalues a home to be on a busy street or how much that remodel affected the value of your home (if it affected it at all.)  We kept a copy of our certified appraisal handy to show buyers and agents that wondered about our pricing.  It put buyers at ease about our price and freed them up mentally to focus on the features of our home.

Another one of my clients had an appraisal done first thing before going on the market.  She was approached by an agent that had an interested buyer.  The agent came armed with a stack of “comparables” to try and convince her she was overpriced.  My client was able to pull out her appraisal and show the agent real comparables that supported her price.  Because she had an appraisal and was priced correctly, she was able to respectfully stand her ground get her asking price.

No home seller wants to drag out the selling process. It’s a roller coaster ride as it is.  Having an appraisal done before you go on the market is a professional strategy that has multiple benefits.  The buyer ‘s lender will have an appraisal done as part of the loan process, so home sellers often don’t think to have one done themselves beforehand.  Besides saving you from aging on the market as an overpriced listing, it gives you credibility.

More Resources:  By Owner University members have access to premium content including the 9 page e-book course on “Pricing Your Home.”  Login or enroll to get access.