How do you accurately estimate the value of your home? When under the excellent guidance of Altru Realty, pricing the home accurately is an artful process of critical importance for a successful sale.
Most offers, if not a full-price offer, are always a meet-in-the-middle offer. If a seller is listed at $550,000 and the offer is $500,000, that buyer’s intent is $525,000. If the buyer does not make an offer it is because the buyer’s meet in the middle number we call “happy buyer number” is too far away from the seller list price. That is real estate in a nut shell.
So here are some points to consider:
- A seller’s list price should reflect a price that will garner a full-price offer from the buyer
- Pricing a home accurately requires thoughtful consideration using a combination of many data points. Some of the data points include:
- The neighborhood
- Home improvements done by the seller
- An analysis of recent sales through a comparable market analysis (CMA).
- Recently sold homes
- The uniqueness of home
- Once an accurate or relevant list price is established, an Altru negotiator will seek a cluster of offers around a specific value or price. If the sellers’ list price is too far above the cluster of offers, then a price adjustment may be in order, moving the list price to a little above the cluster of offers.
- Pricing a home is an art. It is not an exact science because each buyer provides missing data points which an Altru negotiator will seek. This process is called proving value or proving price.
- Proving price is a process of exploring the highest valuation. This is the best home value estimator. Proving price cannot be done with excess wiggle-room. When working to find value and adjusting the price accordingly, new buyers appear along with the current (offers) buyers creating a competitive environment. That environment allows the seller and the Altru negotiators to explore exactly how much the best buyer will pay.
- The initial list price is nothing more than a relevant number (place-holder) designed to attract as many offers as possible but not necessarily the final sales price.
- Buyers or the market do not lie when it comes to data points such as offers, no offers, showings or lack thereof. If offers aren’t flowing then don’t presume that the seller has the home priced correctly.
- Eventually, our expert certified Altru negotiator will identify which buyer is willing to pay the most.
- Altru negotiators always ask a seller when they bought the home and how much have they added in improvements. We then analyze the markup a seller is seeking over their total monies in a deal. Typically the real estate market increases 2-3% per year. Seldom does a property sell for much greater than 3.5% appreciation per year. If the seller’s math (or markup) reflecting 4-6 % appreciation per year, that math seldom to never works. The same can be said about having 10 showings and no offers. Why would the 11th buyer make an offer if the prior 10 buyers didn’t?
- We price to attract as many buyers as possible, applying extreme patience, while carefully analyzing the offer flow and always seeking to prove value to the seller.
Find out more about the Altru Way.