You’ve listed your home – first of all, congratulations on taking that step! With Bōde, we provide you with step by step support and information as you navigate through the process of selling your own home. Our digital platform completely streamlines the entire transaction from listing to keys, and creates a convenient experience for sellers.
As a seller, a challenge you may be faced with along the way is pricing your home at the right value to encourage offers, while still retaining the most equity possible by selling for the maximum value – but don’t worry, we’ve got you.
What should you consider?
Initial List Price
An important consideration when determining the initial list price of your home is that overpricing your home from the get-go typically leads to underselling in the end. This is due to successive price drops which ultimately brings the home under market value by the time it sells. Time on market makes an impact on buyer offers so it is always best to start with the most accurate price possible.
The stages tend to go like this:
You set a high list price (above ‘Market Value’) hoping to attract a high offer.
No offers come in, so you sit and wait.
While you wait, your overpriced home helps make more competitively priced property look better value for money – you actually help others to sell before you!
Eventually you give in and make a small price reduction. You wait but it does nothing, so you reduce the price again. You repeat this process until you reach the point where your property is priced at ‘Market Value’. Now it should sell but it doesn’t.
The problem is because so much time has passed, and the property has been so overexposed to the market, it’s become a ‘stale listing’.
Buyers start to think “What’s wrong with this property?” – They have lost confidence your home is a ‘good buy’ and continue to stay away.
To generate offers you have to reduce your price below ‘Market Value’ to counteract the negative stigma now attached to your home.
As counterintuitive as it seems, properties initially priced above ‘Market Value’ tend to sell for less than if their original prices had looked more attractive to buyers.
As we tend to have an implicit bias to valuing our homes higher than potential buyers, having your home professionally appraised can be a great investment. We have local, highly referred, and vetted appraisers available in our Prō Marketplace.
Market Data, Sold Data, and Comparables
The best way to accurately price your home is to see what other similar properties are selling for in your area. The top determining factors of price are: Location, Type & Style, and Size.
Our comprehensive data tools allow you to keep an eye on what is happening in the market to inform your initial list price and any potential price adjustments during the listing process. Try out our data tools here.
Number of showing requests
If you are not receiving any or very minimal showing requests you are likely 10% or more too high on your list price. You can compare your showings to what is considered “average” week by week using our extremely insightful Listings Dashboard. Based on this information, you can decide if it is in your best interest to lower your price. Once your price has been dropped, you should see a pretty immediate response in terms of showing requests if you have adjusted to a more accurate value for your property.
Sometimes sellers believe if they price high, best case they will sell at that price and worst case they will receive a low offer that they can choose to accept. However, what we know about the psychology of buyers is that they will rarely make low-ball offers. If a home is overpriced, it is unlikely to receive offers – even at a much lower price. If you are showing your home but not receiving offers, you are likely still priced too high by approximately 5% or so.
It’s important to reach out for feedback from buyers or their agent to get their thoughts and insight into why your home isn’t receiving offers. Check out of 6 Tips for Hosting an Epic Showing blog for more information on how to make your home appealing to potential buyers.
How does Bōde help if I decide to drop my price?
Our team is there to support you in marketing your home when you make any adjustments to your listing. For price reductions, we update the list price on Bōde, MLS, and all other listing sites your property is shown on. We also create a new visual ad and adjust this on your personalized digital advertisement.
In a time crunch? From our events page you will also have access to all our previously recorded webinars.
And if you would like to speak with an expert on our team, you can book a 15 minute session with Jeff Jackson, Bōde co-founder and VP of Enterprise Sales, by conveniently choosing a time that fits your schedule.