What is Market Value?
Simply put, it is the price where there are multiple buyers for that particular property today.
Is it possible to beat the market?
The importance of pricing
Having all four pieces of the puzzle in place is essential to getting the best net outcome.
The dangers of overpricing
The internet creates a digital footprint intensifying the danger posed by an extended marketing period. If a property is launched onto the main real estate portals at an inflated price and doesn’t sell, significant long-term damage occurs to the property’s recorded history and thus the eventual selling price.
Methods of estimating the value of your property that some sellers are influenced by
Using automated algorithms – On the house.com. Corelogic, bank apps (ANZ)
Similar properties for sale – For sale prices do not mean SOLD prices
Emotional value /Endowment effect – The Endowment Effect can be defined bas the difference between what the owner expects and hopes the property will sell for, and the market value.
Advice from well-meaning family and friends – Well-meaning does not mean expert
The two lies from agents
- Improbable lie – The Improbable lie is where an agent intentionally inflates a homeowner’s potential selling price – it’s the lie most people are aware of and dislike about real estate agents! The agent preys on the endowment effect and the homeowner’s emotions regarding their property. The improbably lie is an attempt by the agent to get the listing at a price that is only just believable – THAT IS WHY IT WORKS
- The lie of omission – when an agent, knowing the probable selling price, choses not to tell the owner. The agent may say, “We will have to let the omitting this critical information
Accurately pricing your property for today’s market
It is essential that this estimation is evidence based
What a competent agent will then provide is an interpretation of this evidence, such as:
- How does this information relate to the current marketplace?
- Is it a buyer’s or seller’s market?
- What are the strengths of your property?
- What will the current buyers be looking for and comparing to?
- Is there perceived value?
What current cycle of the market is your property in?
Your property’s current cycle of the market will determine the strategy you employ It is important that the presentation of the property be congruent with the pricing of the property
Residential Price Mountain
PRICING IS THE KEY COMPONENT OF YOUR MARKETING CAMPAIGN
The lower you set your price the MORE buyers you have interested
The higher you set your price the FEWER buyers you have interested
Never allow your interested buyers to know what other offers you have recieved!!
What is the likely sell range?