May 11, 2016 – Pricing Mistakes Made by Sellers
Pricing a home is easy, right? I mean you know what all of the homes in the area sold for, so coming up with a number should be as easy as 1-2- 3, right? The reality is no. And many homeowners are making some simple mistakes when pricing their home.
1. Sellers are pricing their homes based on what is “for sale” in the area, not what “has sold”. Some of these homes on the market have been sitting for a very long time. Why would a seller want to join these “unsolds”? Wouldn’t a seller want to look at the actual sale prices to determine market price?
2. Money spent on upgrades is not proportionally equal to increase in home value. A homeowner always overvalues things simply because he/she owns them. Beautiful amenities can change the selling price of a home a little bit within a predetermined range (based on location, size and condition) but they cannot move the price into an entire higher range.
3. Some sellers are pricing their homes based on what they “need” to buy their new home, not on what their home is really worth. This is an obvious mistake; no one cares what the seller “needs”… well except the seller!
4. Don’t believe the Zestimate! Too many sellers are basing their selling price on an estimate that Zillow itself admits has an error rate of about 8%.
The seller is the boss at the end of the day. The real estate agent needs to make sure to educate the seller and give the best information and advice needed to determine the sales price. At this point, with an agent’s expert help, pricing the home should become as easy as 1-2- 3!
My Home Group