Pricing your home is an important decision and can differ, depending on the outcome you are after. If you are thinking of putting your home on the market, the first step is to have a clear picture on the outcome you are hoping for. Are you looking for a quick sale, perhaps because you have another offer in place that is subject to the sale of your home? Would you prefer to remain conservative and price your home at market value based on research and evidence of similar recent sales in your area? Or would you like to take a more speculative approach? You know the market is hot, and you’re in no rush to sell, this strategy can produce ultimate rewards but also has drawbacks which we will discuss. There are three main ways to price a home for sale, which option is right for you?
In some cases, sellers want to sell quickly, and are willing to leave some dollars on the table for a quick and seamless transaction. We often see this when a seller has an offer on another property, subject to the sale of their home. In many of these cases, the primary objective is to sell fast. There are other scenarios which warrant aggressive pricing and before deciding to price your home below or at the lower end of the market, make sure that a quick sale is your number one priority in the transaction. The ideal outcome when pricing your home aggressively is attracting multiple offers which ultimately can result in sales above asking price (and sometimes above market price too).
This is the most common pricing strategy adopted. It involves thorough market research on recent sales of comparible homes in your neighbourhood. Generally a time period is selected where the market has remained un-changed. Only recent sales are examined, as current listings are not enough to determine what the market is doing. Once a valid list of comparible sales has been compiled, factors external to your home (including policy and regulation changes, interest environment, economic conditions) are evaluated. We will also look at your property, make adjustments for variations in bedrooms, bathrooms, square footage, orientations etc. in relation to comparibles, and with all of this information we will determine what is the market price for you home.
The final pricing strategy that we sometimes see, is speculative pricing. This is more common in a market like Whistler, where it’s a ‘sellers’ market, and property values are escalating at above average rates. Speculative pricing is putting a price tag on your home that is above the current market price, assuming that the market is going up, and buyers may be willing to pay a premium for your property. The danger of this pricing strategy is if priced too high, your home may sit on the market longer than necessary and the listing could become stale. In these cases price reductions are sometimes inevitable, making the entire process of selling longer than it could have been. For those who are testing the market, usually investors or people not determined to sell, speculative pricing can be a good strategy.
So which pricing strategy is right for you? If you’re thinking of selling your home or Whistler investment property, contact me let’s discuss which pricing strategy would match your situation, selling goals and objectives.