Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Wednesday, December 22, 2010
Pricing a home to sell in the current market can be a challenge. Oftentimes, there aren't enough recent comparable sales with which to come to a solid conclusion about the value of a house. Another perspective from which to explore the value of a home is by putting it in the context of other homes currently listed for sale. Let's take a look at how this might work.....
Comparable Home #1 - FOR SALE
Priced at $235,000 / Days on Market: 45
Comparable Home #2 - FOR SALE
Priced at $240,000 / Days on Market: 75
Comparable Home #3 - FOR SALE
Priced at $229,000 / Days on Market: 150
Looking at the above, we might reasonably assume that we could price your home at $229,000 and be just fine with selling it in a reasonable time period. We might even get away with pricing it at $235,000. Or if we wanted a faster sale $225,000 should do the trick.
But wait..........several recent experiences suggest to me that none of the conclusions stated above are reasonable assumptions.......
What if we knew that none of the three homes have had any showings in the 1.5, 2.5 or 5 months that they have been on the market. Does that change things? You bet! By pricing your home in the same general range as these three comparable homes we would likely be setting ourselves up to have approximately the same number of showings that they have had............zero!
Now, unfortunately, it's not always the case that we can know how many showings comparable active listings have had in the past X months. It is something, however, that we can (and should!) at least TRY to find out through conversation with the listing agents.
As one additional reinforcement of this point, even if three homes had sold for $245k in the past six months, that still doesn't mean the three list prices we considered above ($225k, $229k, $235k) are reasonable. If comparably priced homes that are currently on the market are seeing absolutely no buyer interest given their pricing, then we'd be foolish to list at the same general price point and expect different results.
So......how many showings do you want to see on your newly listed home? I'm assuming a few more than zero!
Comparable Home #1 - FOR SALE
Priced at $235,000 / Days on Market: 45
Comparable Home #2 - FOR SALE
Priced at $240,000 / Days on Market: 75
Comparable Home #3 - FOR SALE
Priced at $229,000 / Days on Market: 150
Looking at the above, we might reasonably assume that we could price your home at $229,000 and be just fine with selling it in a reasonable time period. We might even get away with pricing it at $235,000. Or if we wanted a faster sale $225,000 should do the trick.
But wait..........several recent experiences suggest to me that none of the conclusions stated above are reasonable assumptions.......
What if we knew that none of the three homes have had any showings in the 1.5, 2.5 or 5 months that they have been on the market. Does that change things? You bet! By pricing your home in the same general range as these three comparable homes we would likely be setting ourselves up to have approximately the same number of showings that they have had............zero!
Now, unfortunately, it's not always the case that we can know how many showings comparable active listings have had in the past X months. It is something, however, that we can (and should!) at least TRY to find out through conversation with the listing agents.
As one additional reinforcement of this point, even if three homes had sold for $245k in the past six months, that still doesn't mean the three list prices we considered above ($225k, $229k, $235k) are reasonable. If comparably priced homes that are currently on the market are seeing absolutely no buyer interest given their pricing, then we'd be foolish to list at the same general price point and expect different results.
So......how many showings do you want to see on your newly listed home? I'm assuming a few more than zero!
