The Prudence of Proper Pricing
Q: What’s the biggest mistake people make when they sell a house or a car?
A: They don’t price it within 3 to 5% of the market!
Realtors will tell you that a constant struggle is to get people to price around the market value of comparable properties.
No matter how great you think your property is or how much you’ve renovated, there still is a group of “comparable properties” out there. And you will never get more than 3 to 5% more than that average price.
And if you price it too high, your house will sit longer on the market, and develop a reputation that you will never defeat – because listings always show the history of a property. Smart sellers can move their property within a short period of time if they price it no more than 3% to 5% over market.
Also, the first set of offers (even if multiple offers come in) will generally be your best bet unless you are in an “irrationally exuberant” market where rapid price increases or severe supply constraints are in place. Your offers do not improve with time. They deteriorate with time.
The same applies to selling your car. No matter how great the detailing job is you are not going to sell it for more than a few percentage points from the established used car price for that model. You can move it quickly or you can let it sit in the driveway losing value, as you quietly get desperate to dump it.
The ancient truth of pricing is: Price it right and you will move it.
Wasting time with unrealistic expectations will still only bring you back to selling it at or even below market.
Our great team assists clients daily with this and other business pricing challenges.
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