Selling your home today requires a firm understanding of Pricing Right. We are living in an age of low inventory in the housing market. For the past 7-8 months, inventory across the nation has been at an all time low. Does this mean you can price your home as high as the sky? Well here I will cover for you what your alternatives are and then you can decide.
How much do you owe?
This should be the first thing you think of when pricing your home. For some it is obvious, don't price below what you owe. Well that might be a mistake because of pending issues you may be facing like foreclosure, litigation, etc. You must think of your situation and the speed of which you need to liquidate the money tied up in the house.
What is the market price of a home like yours?
This is actually the best question you can ask.However most people look at value differently, especially those living in the house. because of the emotional attachment to the house, owners are one of worst people to place a value on the home. Here you need an objective opinion and the most objective is an appraiser, however a good Realtor can get you very close. The key here is the value of the home is like any other commodity, it is what people will pay for it in the open market. Now this can be skewed with the right marketing but not as much as you may think. So keep that secret in mind. It is what people will pay. Go shopping for a house like yours, this could surprise you.
What type of market is it.
Normally the real estate market has three types of descriptions, Sellers, balanced, and Buyers. Each represent the condition of inventory based on how many months it would take to deplete. Like I mentioned earlier it has been a sellers market for about 3/4 of a year. This usually causes increases in the price of a home. By taking this a the sole driver of pricing we would have skyrocketing home prices. But we don't!. Why? The lack of consumer confidence in the economy. Once that returns look out, prices will start to rise. How about the other types of markets, well a balance market is just what it indicates. Prices will be level for the most part. Now a buyers market does not mean prices tank. The price does lower due to more competition but only a small amount.
Today's issues
The previous points and a few more would normally prevail as a basics for pricing a home, but today there are a few new pressures affecting our market. The first is the lack of income in the market for most working people. If you can't provide for yourself and your family you can't be in a position to buy a house. Therefore, due to the loss of employment, buyers are not as plentiful as normal. Simply put the demand is not there. Yet in certain micro markets the demand is still strong and houses have been out selling the inventory replenishment. For the past 4 months, in the Tampa and Wesley Chapel area, houses having been selling at twice the rate of new homes coming in to the market. You can also see that the market is also See some of the examples.
March 2020
April 2020
May 2020
So what is the bottom line
To price your home right, start with these points in mind and don't get blinded by the emotions. If you price to the market you will get the most value for your home. If priced too high, you will have your house on the market for a long time and the longer it stays the weaker the value to the market. What do you think of when you see a house on the market too long. "Whats wrong with it?" Do you want yours to be that house? Now, if you price it right, you will not only sell it quickly but you will possibly get multiple offers and potentially a bidding war. Now that's nice.
So keep these thoughts in mind and if you need help reach out to me, I am here to help. Let me know your thoughts and if this has help your planning.
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