When you're ready to sell your home, you'll need to sit down with your real estate agent to determine a selling price. You might have a good idea of what you think your house is worth, your agent might have another price in mind, and the potential buyer might not agree with either of them. Here are some pricing tips and myths you want to be aware of as you prepare to put your home on the market.
Price it High
As sellers, we may feel that pricing our home high gives us a better chance of getting an offer close to asking price. The opposite is true a lot of the time. When your home is priced too high, you may run into the problem of little buyer interest. Overpricing can scare buyers away and you may never get them back. Even if you decide to lower the price after a few showings and little interest, the amount of days on market will have started to accumulate and buyers might not give your home a second glance. It's important to listen to your real estate agent to establish a competitive price based on recent sales in your neighborhood.
When negotiating with an interested party, you may feel that giving the potential buyer the closing date they want will result in you having the ability to negotiate a higher price. Just because you want to be out of the house in 30 days doesn't mean the buyer can accommodate (they may be on vacation on the date you wish to close). If the buyer chooses a different closing date and you agree, but bump up the final price, you may find them walking away from the deal. When negotiating the final price, don't expect to get a higher price just because you've relented on the closing date.
Including Household Furnishings
If you've ever looked at homes for sale, you've seen some which include furnishings. A large, custom sectional in the livingroom, a hot tub, or a television might be included in the sales price. If you get a low offer and decide to counteroffer and include some of your furniture, you might be disappointed in the buyer's reaction. The buyer isn't necessarily going to see value in your furniture and agree to increase their offer. Avoid using furnishings in negotiations until you've agreed on a price. Then, leave it up to the buyer to ask for a piece of furniture they really want to add to their final offer.
Selling "As Is"
Just because you're selling your house "as is" doesn't mean the buyer will stick to their offer after an inspection. "As is" often leaves a potential buyer with the thought that there is far more going on with the house than meets the eye (ex. old wiring, lack of insulation, shody renovation work, etc.). Following an inspection, they may feel the sales price is too high for what they're getting into. At this point, renegotiation may be in order and they may back out of the contract. In a nutshell, adding "as is" to your listing isn't going to guarantee you'll get the price you're asking and you may ended up with far less or a cancelled agreement.
When it comes to negotiating a price for your home, the buyer may not be willing to meet you in the middle. For example, if you agree to drop the price down $20,000, don't expect the buyer to come up a proportionate amount. Instead of coming up $10,000, they may only come up $5,000. As you fight for what you feel your house is worth, the buyer may not be willing to budge especially if the house wasn't properly priced to begin with. Make sure you hire a real estate agent with good negotiating skills but also someone who's going to help you keep everything in perspective.
All of these myths are important to keep in mind as you prepare to price and eventually sell your home. Have an in-depth conversation with your real estate agent about pricing your house to fit the current market (aka: what buyers are willing to pay). Also, discuss the scenarios in this article so you're comfortable knowing how your agent will address the issues should they arise. Using the expertise of your agent will save you many headaches and allow you to get your house under contract in less time and for a fair price.