How to Price your Home Correctly: 3 Basic Tips
“How much does it cost?”
You may have some experience about going to the mall and wanting to buy a product, but not until you see its price.
Price is one of the considerations that make the buyer decide whether to buy a product or not. It is a factor that greatly affects the decision-making process of a potential buyer. In real estate investing, setting the correct offer is important to win deals. A superb property may lose the interest of potential buyers if it is overpriced.
Here are the 3 basic tips on how to price your home correctly:
Tip No. 1: Place a competitive price
The value of your offer to the subject property is affected by the market condition. You must consider the demand and supply of purchasing a property in your selected area. You must be mindful of the market competition because you may lose potential buyers when the price is too high. On the other hand, you may not have a good return on investment when you set the price of the property too low.
An effective strategy to set a competitive offer is to research the comps. You need to put yourself in the buyer’s shoes and see if your offer is competitive among the other properties in the list.
Feel free to check our Deal Analysis Suite here. It may help you to use live MLS data to quickly and easily run your own CMA/comps!
Tip No. 2: Assess the condition of the property
As with selling a product, listing a property for sale means you need to assess the condition of the house. The price must be responsive to the condition of the property.
One way to increase the appraised value of a property is house flipping. It is a process of doing renovations and improvements before selling the property at a more competitive offer.
If you want to read more about fix-and-flip strategy, you may check our investment blogs here.
Tip No. 3: Do not price the property too high
An overpriced property usually turned off the buyer. As such, the property may stay too long in the listings when there is no offer to buy. This instance may lead to long-term problems. First, it will result in the deterioration of the subject property. Second, a house staying longer in the listing creates a negative implication. People may think that there is a problem in your property that is why no one is interested to buy it.
To resolve, you must be realistic and do not set the price of your property too high. You must strategize to make your maximum allowable offer attractive still to get home offers.
In pricing a property, you must take into consideration the present situation in the market. In these times of COVID-19 pandemic, setting the best price of the property may be a bit challenging to real estate investors. Learn how to cope up with new house selling techniques by reading our blog, “House Selling the NCOV Way: Not Your Ordinary Selling Strategy”.
With these three basic tips, you can now explore on setting the best price for your next deal. Keep yourself up-to-date about the trends and take opportunities to grow. Make learning a continuous journey by watching and joining our webinars at REIQ Events.
The blog articles are intended for educational and informational purposes only. Nothing in the content is intended as legal or financial advice.