In any market, correctly pricing your home is critical to you selling for the most the market will pay. Why? Because, if you overprice your home you will attract the wrong buyers to your property. These buyers will be expecting a property worth more than yours. They will vote with their feet – and move on.
We’ve all seen properties that sit on the market for many months, possibly even years. One is immediately suspicious that there is something wrong with the property. Buyers will almost never pay market value for a property that has been listed for an extended period of time.
Research and experience have proven that a property that is correctly priced sells more quickly than an overpriced property. We can also, with confidence, say that a property that sells more quickly sells for more money than one that is overpriced.
The reason for this is that, at any one point in time, there is an existing pool of buyers in the market. When they see a new property coming to market they will respond to the marketing, and view the new listing. After this initial marketing period, it’s only the trickle of new buyers that come into the market that view the home.
So it stands to reason that most buyers, and the best buyers, will view the property in this initial marketing period. In our experience at Harcourts this initial marketing period is the first 8 weeks that a property comes to market. It’s absolutely critical that your listing price is in line with market value in this period in order to attract the correct buyer enquiry.
When you do this – attract the correct buyers – you will create buyer competition. And that’s when buyers will pay their maximum for your property.
This is true for all markets. But it’s especially true in our current market. The reason we say this is because there are fewer buyers shopping for property than there have been in the past few years. The main reasons for this are economic pressures, political uncertainty, and the inability of the buyer to sell their existing property in order to purchase.
When there are fewer buyers it’s important that, if you want to sell, you need to attract them to your property over other competing listings. How can you do this? Recent statistics show that buyers respond to properties listed within 5% or less of market value. If you’re priced too high you just won’t get serious interest.
Additionally, you need to ensure that your property is aggressively marketed. If your listing is lost in the crowd, perhaps one of many hundreds of listings on a property website, then you just won’t attract the interest that you need.
A comprehensive marketing plan that throws the net wide to attract all the buyers, and correct pricing, are key to you selling for maximum market value.
Principal of Harcourts Platinum
Director of Harcourts South Africa