Each Home Has Its Own Supply Of Buyers

Category: Finance, Real Estate.

If you could control the demand for your home, wouldn t you want to? What many home sellers don t realize is that they truly can control demand for their home with one simple factor.

Well, that is somewhat of a rhetorical question because any homeowner who could would want to turn on a buying frenzy for their home. This one simple factor is price. How you price your home is the most important factor in how much demand you ll have for it. This is probably not a surprise to you because basic economics dictates that there is one thing that affects demand more than anything else- and that one thing is price. For example, some folks take the tactic that they should always start their price high knowing full well that the home is overpriced. They think to themselves, "We can always come down on price later. " The problem with the high- price, maybe- we ll- get- lucky scheme is that the amount of time to sell the home can be several times longer than it would be with a home that was priced right in the first place. They think that it s fine to start high.

The main reason for this is the supply and demand of your home. Another way to look at it is that the demand for your home is directly proportional to how closely you price it to its Fair Market Value. Each home has its own supply of buyers. You can effectively control the demand for your home and how quickly it sells with the right asking price. On the contrary, if you price it above fair market value, you ll reduce the number of buyers for your home to 10% or less of the available pool. If you price the home at fair market value, you ll be attractive to 60% of the available buyers for a home in your range.

Over pricing your property shrinks the prospective buyer pool by more than 50% . So, is a high price more important to you than selling your home quickly( or at least in a reasonable amount of time) ? A property priced just 15% over the market value appeals to no one in your property pool. You ll have to be the judge of that. This strategy will almost guarantee that you ll sell your home for the highest price in the least amount of time. It is absolutely imperative that you price your home at Fair Market Value from the beginning of the listing.

What most home sellers don t know is that, often, 80% of the effectiveness of marketing a home is linked to what you price your home from the very beginning. The true Fair Market Value of your home is subjective and determined by what a buyer is willing to pay and you( the seller) are willing to sell for in today s market conditions. You set a precedent to an extent. That s the true Fair Market Value of your home, and it is based on the needs and wants of both parties involved in the transaction. They will base their offer on a comparison of your property to other sold( or available) properties in your area. With the Internet available to most people, today s buyers have all the information that you have.

They will evaluate your home against the others, comparing the cost verses the value, based on their needs.

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