For Agents’ Eyes Only…
Each Thursday we will be posting a blog to help real estate professionals understand how they can better assist their buyers and sellers navigate the current real estate market. Hope you find the information helpful. – The KCM Crew
Heading into the fall and winter, it is important to educate your sellers on the best pricing practices to ensure that their home sells for the most money. Pricing a home correctly from the beginning vs. pricing it higher in order to leave 'room for negotiation' actually nets the homeowner more money.
This was reported on in a post we have run before by Ken H. Johnson, Ph.D. — Florida International University (FIU) and Editor of the Journal of Housing Research. Dr. Johnson explained that proper pricing has been studied by John R. Knight:
"The findings from this research indicate that, on average, properties which experience a listing price change take longer to sell and suffer a price discount greater than similar properties...
Sellers as well as Brokers/Agents should therefore be aware of the critical necessity of getting the price correct from the start. Sellers wanting to over list will ultimately take longer to sell and will sell their property for less, on average, according to Knight. Brokers/Agents’ desire to take a listing and get the price right later will ultimately lead to their working harder according to Knight, and they are not doing their sellers any favors. Thus, an initial and detailed analysis of the proper price is much more critical than many originally thought."
It is important for agents to work hard pricing the listing correctly from the start. If not, it will cost the seller both time and money.