When faced with black and white, factual data why dohomeowners/sellers still insist that their property is worth more than what theCMA (competitive market analysis) says it should be priced at?
When you take your car in for brakes, do you argue with yourmechanic? He is standing therewith a quote, in black and white, and you simply say – “Ok”. Why? Oh, because this is his area of expertise and you are payinghim for his education and experience and knowledge.
One of the hardest things in real estate is gettinghomeowners to competitively price their property.
When doing a CMA, this RealtorÒtakes a 2 pronged approach. FirstI go at it as an appraiser might - bedrooms, baths, square footage andlot/acreage size for finding comps.
Once I get that baseline, then I add the intangibles, thewarm fuzzies. Type of cabinets andcountertops, have the bathrooms and kitchen been updated. I look at the light fixtures, are they80’s throwbacks or sleek and modern?
Pricing a property competetively for sale is an art so muchmore than a science. Once you havedone all that, the really hard part begins………sitting down with the homeownerwho is convinced that their property will bring $100,000.00 more than the 12properties you’ve shown them in their subdivision alone as comps.
Homes are most people’s single, largest financialinvestment, and as such folks think that they will hit the lottery when theysell it. We all do it, even thisRealtorÒ. We hope for the best.
However, we all must get realistic and quickly if we want tosell our properties.
1. Buyers are prequalified (or at least they shouldbe). That way they know exactlyhow much home they can afford and that is the price range they look.
2. Buyers have a comfort level of a monthly paymentthey want to pay, which is usually way less than what they have beenprequalified for and therefore look at homes priced less than what they areprequalified.
3. It’s a Buyer’s Market. I’m sorry but it is. Your property is competing with all the other properties out there forthe very few Buyers that are able to buy right now.
4. Buyers want a bargain. At this point, it’s up to the agent to manage the Buyer’sexpectations about being able to find one of those “awesome deals like they seeon TV”.
5. Let’s say for the sake of argument a Buyerstumbles upon your house and falls in love, and they are prequalified for yourasking price. They begin the loanprocess and it gets to the appraisal and your property won’t appraise for whatit needs to for the Buyers to get their loan.
Now for the BIGGIE. The one thing that every RealtorÒthinks when you tell them what you want to ask for your property, but most willnot say to you.
If you do not price your propertycompetitively, meaning, your price is too high, it will sit on themarket. It will languish outthere. It will become worn out and ragged. Buyers will become sensitized to it and no longer even see it when theyare searching. You willincrementally over the course of time, sometime years, reduce your price to where you were told 2 years priorthat your home should be priced. (I can show you many properties with this exact scenario.)
As the Seller, your goal when putting your house on themarket is to sell it. Not have my“For Sale” sign sit in your yard forever (even though it is a very attractivesign).
RealtorsÒare professionals, we have the education and experience to do our jobs. When you are ready to put your home onthe market, interview several different agents from different brokerages. Ask the hard questions and see what answersyou get. Ask to see the factualdata to back up those answers.
A good RealtorÒwill always tell you the truth and share their facts, even if it means losingyour listing.