You’re thinking about putting your home on the market. The place you worked so hard for. The house you raised your kids in. The home that holds so many memories. Chances are, it’s one of your most important assets and you’re wrestling with the emotion of pricing such a valuable commodity.
According to a recent survey, most sellers have unrealistic price expectations. The data showed 92% of agents believed that vendors price expectations are too high when selling. This was supported by the number of sellers (36%) who had expectations of up to $50,000 above the market price. In addition, 55% of agents agreed that the homeowner’s expectations are above market price expectations by $50,000 or more.
Here at Perspective, we know you love your house—that killer kitchen, the beautiful swimming pool and all those sentimental memories. But we also know what happens when you price a property too high.
Sales Consultant, Adrian Stroh, says the price of your property can make or break your success. “If you decide to price your home too high, it may take longer to sell. The longer it’s on the market, the more doubt you’ll create about whether there’s something wrong with your home. A high price can also help sell other properties around you in comparison—buyers may think they’re snapping up a bargain.”
So how do you set a reasonable price on something that has so much value to you? Adrian believes it’s all about doing your research and getting a second opinion. “I suggest visiting open homes, viewing current listings online, getting professional advice from a local real estate agent and listening to their feedback about your home,” he says.
Adrian takes us through the ways a professional agent can help you form realistic expectations about the worth of our homes.
Comparative Market Analysis
A Comparative Market Analysis or CMA is a very handy unbiased report that is put together by your agent that showcases recently sold properties or currently listed in your specific area. It gives you everything you need to know about the home — sale price, aesthetic details and days on market. This document will help you understand what’s been happening in your suburb, compare properties like your own and get an idea of where your home sits in the market.
Adrian says, “The CMA is a great opportunity for you to see and understand that your home is placed on the market in competition and not in isolation. Ask your agent to talk through the CMA and about any current development applications and infrastructure in your surrounding area which may impact the property’s potential sale price, such as building developments and future scheduled changes.”
What a better way to find your home’s worth than with an expert? A property appraisal is a price estimate performed by a knowledgeable local real estate agent. The agent will take into account your home’s location, features, recent sales and market trends in your area and give you an approximation.
Adrian says, “we have an opportunity to see firsthand how a buyer might view the property, so we also provide advice on where the seller can add value and ultimately boost their sale price— we do this by instructing the seller on how to present their property, and where to invest in maintenance and repairs.”
Adrian warns sellers of going with an agent who promises to get you the highest price. Unfortunately, some agents will over-quote to ‘win the listing’, which leads to listing your property for more than it’s worth. Ask your agent to back up their estimate with fact, particularly if it’s significantly different from other agents.
During the discovery process, an agent should learn and understand your motivations for selling. Whether it’s a new job in Woop Woop, a property upgrade because you won the lotto or a relationship breakdown, the reason behind your decision will indicate many things to an agent.
Adrian says, “it’s not about being nosy. The motivation can sometimes be linked to a timeframe. If so, this will determine the method of pricing, the preparation for market and the overall marketing plan.”
Another clever reason why agents ask about your motivations is to help them decide what sale method is right for you. Based on the current state of the market, an agent may suggest an auction if the homeowner is in a rush to sell. Otherwise, they may offer private treaty. “We also use the reason to negotiate on terms and conditions to suit the seller,” says Adrian.
The state of your property is an important price indicator. Imagine chipped wall paint, a broken toilet and stained, dirty carpet can all reduce the eventual sale price of your home. A good agent can give you an indication of what financial pay off a small investment in maintenance can bring.
“We facilitate the maintenance of the property by organising various reliable trades, negotiating quote and scheduling the works required to meet the seller’s time-frame and budget. We will only recommend maintenance to be undertaken should we feel it will likely add to their overall sale price,” Adrian says.
As much as you renovate or repair your property, you must keep in mind that buyers do not yet have an emotional connection to the home and will base their value in comparison to other properties in your area.
It is every home seller’s dream to get top dollar for their property, but it’s essential not let your emotions overtake you while you’re pricing your home. “Separate the love and emotion from pricing your home to give you the best chance of selling your property successfully,” Adrian says.