Every seller wants, and deserves, to sell their property for the highest price the market will pay. Sadly, not every seller achieves this. There is a big difference between selling a property, and selling it for the highest price. I’m sure we’ve all seen properties that have sold and thought: “well that was a bargain!”
When it comes to selling, there are many options available to a seller. It is vitally important that a seller make the correct decisions if they want to achieve the best sale, not just any sale.
The first decision to make is which selling strategy they will use. The word “strategy” implies there is a well thought out plan that is created and then executed in order to achieve a certain result. Far too often very little thought goes into how to achieve the best result – and a property is just thrown into the mix with other listings to achieve an average result.
This week we’ll consider the most commonly used selling strategy: marketing with a price. It’s the way most property is sold in South Africa and, when correctly used, is very effective. With this strategy, it’s imperative that the listing price of the property accurately reflects market value. And therein lies the challenge – to determine what the real current market value is.
If the list price is too high above market value then the marketing attracts the wrong buyers. They buyers won’t see value in the property and will move on to better value. In most cases you won’t even receive offers, as it’s not the sort of property these buyers are looking for. This is the “overpricing” risk.
The other risk is “underpricing”. It’s a terrible feeling for a seller when they realize they listed too low and could have sold for more.
Marketing with a price is effective when the correct listing price is used, and the correct buyers are attracted. It’s also imperative that a powerful marketing plan be used so that all the buyers can find the listing and compete for it. That’s when they make their best offers.
The temptation for a seller is to list with the estate agent that promises the highest price for their property. This tactic that unethical agents use is called “buying your listing”. The reality is that what an agent thinks your property is worth is irrelevant. It’s what the market believes the value is that matters. The only way to determine this is by means of a comparative market analysis.
Wise sellers will appoint the agent that demonstrates, with facts, what their current market value is. They also appoint the agent that can execute a powerful marketing plan – thus attracting the most and the best buyers.
When this strategy is correctly used there is strong competition for the property. Buyers compete and make their best offers – and that’s when you sell for the most the market will pay. Next week we’ll discuss an alternative method that achieves outstanding results.
Principal, Harcourts Platinum
Director Harcourts South Africa