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The Secret To Pricing Your Home To Sell!

The Secret To Pricing Your Home To Sell!

Here is the secret to pricing your home to sell - Contrary to popular belief, when selling your home its value is determined by one thing and one thing only..... what a ready willing and qualified buyer is willing to pay for it. No more and no less. Many sellers argue that their home has an insurance replacement value, or an appraised value, or a tax assessed value, but unless your insurance agent, your banker, or your tax assessor is willing to write you a check for the home - guess what?... None of that matters. truth is, A home without a ready willing and able buyer has no value in the market place...PERIOD!  Sure it might have a value to you the seller, and it might have a value to your banker, and to your insurance agent, and to your appraiser. But none of these people want to buy your home!

So here in lies the trap... As a seller,  you want to price your home to get as much of a return on one of your largest investments of your life as possible. Problem is many sellers have  the mistaken idea that they can hold out for an inflated price and eventually the market will come to them. Unfortunately, this is Wrong!  Buyers are under no obligation to buy any particular home, and no amount of marketing, open houses, websites, or signage will motivate a buyer to purchase an overpriced home. Why? Because they can buy one of your neighbors homes for less! This reveals one of the most important considerations in pricing your home - Price VS Time.

Understanding Price VS Time
The age old dilemma that has faced buyers and sellers since the dawn of private property rights is a simple question: What is more important price or time? Believe it or not, this conundrum underlies and controls every sellers decision to sell, and every buyers decision when to purchase. For sellers this boils down to the need to sell within a set time frame or instead to hold out for the best possible price, and as you might guess, for buyers it's the need to buy within a set time frame or to purchase a home for the lowest possible price.

A seller who would like to sell for top dollar should be prepared to potentially wait longer for a buyer willing to pay a premium price. On the flip side, a seller who needs to sell quickly, and doesn't have time to wait, should expect to discount their price somewhat because of the limited time they have to expose their home to the market.

And buyers are in the same boat. A buyer who has the luxury of shopping for a home over a long period of time can probably wait to find a bargain, while another buyer who must buy a home in the next few weeks will probably be willing to pay a premium. Again it boils down to price vs time.

You see it all the time. A seller who has gone through 3 agents in 2 years and the home has still not sold. I hate to tell you this, but if this is the case, it is not the agents fault unless they set the price. Here are the facts. You  have 75 days to bag a buyer or your home becomes "Stale Bread". 75% of the buyers who will view your home will do so within the first 45 days. After 75 days, you then have to start chasing the market down. You can reduce your price, but most of the buyers who looked at your home in the first 45 days have found a home and are off the market.

So where do you start? A Comparative Market Analysis. A Comparative Market Analysis is a report that compares a specific home, often called the "subject home" with other homes in a specific neighborhood. This analysis is then used to provide an anticipated sales price or price range for the subject property. Although not formally called an appraisal, the report provides a similar function by giving home buyers and home sellers a clear understanding of the market data that might affect their opinion of value. To learn more about using a CMA to help price your home...