“How much are we going to list it for?”
This is a commonly asked question among Whistler homeowners preparing to sell their property. Determining an appropriate listing price is part art, part science. There is no simple formula that we can plug variables into; rather, pricing a property requires research, analysis, and both quantitative and qualitative adjustments.
Here are some of the main factors that go into pricing your property for sale.
The term market value refers to the price that the market as a whole is willing to pay for your property. A good way to get an idea of your property’s market value is to look at what similar properties have sold for recently, under similar market conditions.
Sometimes, this can be pretty straightforward. For example, if your property is located in a townhome complex and there have been numerous sales of similarly sized units in recent months, the sales prices of these units can give us a good idea of what we can expect your property to sell for.
Other times, this can be more challenging: perhaps you live in a unique waterfront chalet, of which there are very few other similar sales – and perhaps those that do exist are several years old.
In either case, though sales comparables are a good starting point for setting a listing price, adjustments will still need to be made to determine the right price.
Your Property’s Unique Attributes
No two properties are exactly alike. Even two side-by-side 2 bed/1 bath condos can have different layouts, different views, and different interiors. These two units, though similar, can have different market values.
Construction quality, views, proximity to amenities, lot size, interior layout, interior finishes, neighbourhood, property type, the presence of a rental suite – these are just a few of the many factors that play a role in determining your property’s value. The presence or absence of these factors and others will require adjustments, either positive or negative, to the market value suggested by the sales comparables.
These adjustments are not always precise. They are determined by understanding how the market values certain factors, which is acquired through experience in the local market. That’s why it pays to hire a Realtor® who specializes in the Whistler market and who has several years of experience.
A property sold for $430,000 in 2011. Five years later, it sold for $650,000 – yet no renovations or upgrades had taken place. How is this possible? Most likely, it is due to changing market conditions.
Whistler real estate market trends play a huge role in determining a property’s value. Economic factors like supply and demand, political factors like zoning restrictions and official community plan changes, and general industry trends like a boost in the popularity of outdoor activities will all influence the listing price of a property.
While sales comparables give us an idea of what a property might have been worth in the past, market trends tell us about the property’s value right now and going forward.
Competition and Inventory
A similar property currently listed for sale does not always paint an accurate picture of what your property is worth. Just because a property is listed at a certain price, that doesn’t mean it will actually sell at – or anywhere close to – its listing price. Just take a look at some properties that have been sitting on the market for months and months – or even years!
Still, competing listings can provide some valuable information in setting a listing price. For instance, if there is an absence of chalets listed for sale in your neighbourhood, you may choose to price your property slightly higher than you might otherwise. If someone is looking to own a home in that neighbourhood, perhaps they’re willing to pay a premium since it is so hard for them to find a suitable property.
Similarly, if there are a dozen near-identical units in your building listed between $500,000 and $550,000, you might want to revisit your idea of listing your unit for $1 million, unless circumstances are extraordinary.
There is an element of strategy to setting a listing price, and your individual selling goals will help determine what is the best path to take.
Listing as close as possible to market value is helpful in selling your property as quickly as possible, if that is a priority. Listing your property below market value may increase the odds of multiple offers and bidding wars, depending on the type of property and the current demand.
Listing far above market value might seem like a good way to gauge how high the market is willing to go, but it might also alienate qualified buyers. For example, let’s say your property’s market value is somewhere between $1.2-$1.3 million. There is a large demand for properties in the $1-$1.5 million price point. You decide to list your property for $1.9 million just to see what will happen. Numerous buyers looking for a property just like yours might skip it over entirely, as it is out of their budget. Meanwhile, those looking for a $2 million home will look at your property and note that it lacks the features they’re looking for – features that are offered by other $2 million properties. The wrong people are looking at your property; it’s getting no offers; and now it has been sitting on the market for a few months, which could generate a stigma later on when you eventually reduce the price.
So what’s the magic number? Contact me, and I’ll walk you through these steps so we can determine the best listing price for your Whistler property