ACTIVITY vs. TIMING
Timing is important in the real estate market. A property attracts the most interest and excitement from the real estate community and potential buyers when it is first listed. Setting a realistic price from the beginning will help take advantage of this initial period and increase the chance of a timely sale. An experience agent who knows the market and the marketing process can help you determine the market value of your home giving you the best chance of quickly and smoothly selling your home.
TIMING vs. SELLING PRICE
When a home is overpriced at the start, it misses what can be the most critical time period in selling a home - the first weeks it's listed. Once this period has passed and little traffic is generated at the initial price level, it becomes necessary to seek a lower listing price. Depending on market conditions this cycle may repeat several times before a sale is made, resulting in an eventual sale price that is well below the initial listing price, and possibly lower than the market value of your home.
PRICING vs. ACTIVITY
At the pyramid's center is the fair market value at which a reasonable percentage of buyers would view and purchase your home. When you price your home closer to fair market value you'll attract a greater percentage of buyers, and when you over price it you'll attract a lesser percentage of buyers.
DETERMINING YOUR HOMES MARKET VALUE
A comprehensive market analysis is essential to determining the value of your property. Location and characteristics of the property are key elements to determining value, therefore the basis of valuation is similar properties in your area. The market analysis takes into account the amount received from recent sales of comparable properties and the quantity of comparable properties currently on the market. The desired end result, of course, is to find a price range that will attract a willing and able buyer in a reasonable time. Once this range of value of your home has been determined, you can decide on an offering price that will achieve your goals. Generally, the price should not exceed the value by more than 5% or potential buyers may not even make offers.