Let's get real about property pricing

31 Mar 2017

Once you have decided to sell your home, you will probably have a value in mind, and chances are once you speak to a real estate agent, it will differ from the agent's suggested price.

This is a stumbling block that happens time and time again. If only sellers could see that an agent’s suggested price is put forward purely to help them sell their home as efficiently as possible, and for the best possible price.

Your home will naturally be more valuable to you because of all the time you have spent living there, the memories you have made, and of course the investments made into the property, however, the value you place on your property may be unrealistic to attract buyers who look for fair market value.

Market-related price

As agents, we suggest a market-related price that is attainable. You don’t have to listen to us, but chances are if you list much higher than recommended, your property may sit on the market for a long time. And the longer a property sits on the market, the less its value is perceived to be.

Sellers need to be aware that buyers notice ‘for sale’ signs - they are online monitoring listings and comparing asking prices. It will be evident if your home sits on the market for a long time, as well as if it seems overpriced compared to similar homes in the area. If the price of your home is in line with current market sentiment, it can spark a bidding war, which will ultimately lead to a higher selling price.

It is not realistic, however, to hope for a higher asking price than your home is worth, particularly in today’s economy. While transfer duty changes in the National Budget this year have provided some relief, it is still very costly for buyers to qualify for a bond and to cover all the additional expenses that come with purchasing a property. You need to be realistic about buyer affordability. If a home has the right price, you will attract the right buyer.

Your agent is best positioned to provide you with accurate information relating to what has sold recently and how it compares with your home. It doesn’t help to look far back. What counts is the recent past as to where the market is.

It is best to take your agent’s advice from the beginning when it comes to pricing. Rather be realistic from the get go to avoid still waiting for an offer after many months on the market, because you priced your property too high.