I’m a firm believer that most homes that go on the market will sell within a range of values.
And that sales price depends a lot on the how well the property is marketed,
how the offers are negotiated,
and also the accuracy of the initial listing price.
I have a real life example of how a Loudoun county homeowner left over $50,000 on the table because they mispriced the listing.
The home was listed significantly below fair market value based on the recent comparable sales.
there are typically two reasons why I see this done.
The first is that the listing agent doesn't have a complete understanding of the local market conditions. Maybe they are unfamiliar with the area or just don't sell a lot of homes in general.
The second reason is that they believe pricing a property low is an effective marketing strategy.
What are the two most popular statistics that agents use to promote their business.
Days on Market and what percentage above LIST price they are able to sell properties.
So they have a huge incentive to List below fair market value and hope that this will stimulate demand.
A better indicator of success, in my opinion, is what percentage above fair market value, NOT list price, was the agent able to secure a contract for the property.
And this is why Pricing is so crucial.
Remember that the List price is a signal to the market.
It's a way to message expectations.
It acts as a starting point for negotiations and often acts as an anchor.
Getting back to the example here in Loudoun.
The house was listed 50,000 dollars LESS than fair market value.
Which actually did stimulate demand to some extent. But the starting point of the negotiations was anchored 50,000 low.
And ultimately the negotiations resulted in a contract price just $30,000 above list price.
Days later, I put my Listing on the market.
Same model as the one that just went under contract. Same neighborhood... actually a stone's throw away. And with considerably less upgrades.
But I priced it exactly what I believed to be fair market value.
So where did we end up?
Just like the home down the street, we accepted an offer $30,000 above list price.
But our list price, our starting point, our anchor, was $50,000 more.
In my opinion, the homeowner down the street left $50,000 on the table because their listing was mispriced.
Strong negotiating strategies matter!
Marketing that exposes the property to the widest possible audience matters!
But pricing the property correctly for the market is just as crucial.
If you are considering selling your Loudoun County home and are worried about selling for thousands of dollars less than what is possible, give me a call and let's discuss your situation.