Q. I am planning to sell my house soon. What is the harm in pricing high initially? I can always come down in price but can't go up. Don't buyers make offers based on what they think it is worth anyway? I don't want to miss a buyer that falls in love with my home and will pay a premium price for it.
A. I am not a fan of knowingly over-pricing a home. A listing that might look great to a buyer at the right price might not even be appealing at an above-market price. I am also not a fan of under-pricing your home. You might not get the multiple bids you had planned on. I believe in putting it at market value and let the market tell you if it can go higher. The danger of initially pricing the home too high is the fact that it is most marketable when it is new on the market. Capitalize on this enthusiasm by presenting a good product at the right price.
In our area we are in a potentially quickly changing market. It presently is pretty stable but slower than last year. Just a jobs report or an interest rate adjustment can disqualify buyers from the market. But regardless of the market, overpriced listings don't sell in any market. If the price is too high the market can literally pass you by.
There is more emotion involved in a home purchase than in most other business negotiations. Home buyers usually need to feel passionate about a property before they'll make an offer. Today's buyer is concerned about overpaying in a potentially softening market.
Q. I want to sell my house but I must admit that the mere thought of negotiation makes me nervous. You might negotiate the price, the length of the listing and various marketing considerations. I am afraid I am at a disadvantage with my limited skills. Have you heard this before?
A. These feelings are not unusual but, like it or not, buying or selling a home involves negotiation. Your first negotiations are with your Real Estate agent. You might negotiate the price at which you will offer it, the length of the listing or certain marketing considerations. Some Realtors are more adept than others in bringing buyer and sellers together. Check them out carefully. Check their references if you haven’t worked with them before.
Negotiation is not a bad thing. It's one of the ways we interact with others in order to realize our goals which, in this case, is selling a home. Try not to think of negotiation as combat. Although you want to sell at the highest price you can get and the buyer wants to buy at the lowest price possible, you both have the same goal: The completion of a home sale.
Send your question & look for your answer in a future column. E-mail: Lynne@LynneFrench.com
Lynne French is the Broker/Owner of Windermere Lynne French & Associates and a Clayton resident. For any real estate needs or questions contact her at (925) 672-8787 or stop in at 6200 Center Street in Clayton.