Listing Price vs. Selling Price – What to Expect
What is a fair listing price? What is a fair selling price? Weather a REALTOR sells four homes a year or four hundred homes the rule of thumb for establishing a listing price for a homeowner or making an initial offer for a buyer is always the same. Statistics show that in a market where there are approximately an equal number of buyers and sellers, homes will sell from 88-92% of the listing price.
If I am working with a seller, I advise them to list their home at 10% but no more than 15% above recently sold similar homes in the past six months. If I am working with a buyer, I suggest making an initial offer of 10% but no less than 15% below recently sold similar homes in the past six months. More often than not unless there is a bidding war, the contract amount for the home will end up being in that 88-92% range of the original listing price.
Homes that are priced this way will attract 60% of the buyers that are looking for homes in the particular price range.
Some sellers don’t understand this and demand that their home be priced at a number that the homeowner wants. An unrealitic seller could say that they want to get back the full value for recent improvements. In all reality no one cares how much money a seller has put into their home. However, improvements will increase the chances of selling a home in relation to other homes that have not been improved. Ultimately price is determined by the supply and demand of the market.
Some buyers have the mindset that they are going to negotiate a ridiculously low price and get their dream home at a steal.
The bottom line is no one is going to pay more for personal improvements that a homeowner falls in love with and a buyer is not going to steal a home. A good deal is one when both the seller and buyer feel that they have made a fair deal for everyone. Your home is worth whatever price someone is willing to pay for it.
Stay healthy and safe and look for those great opportunities. Contact me to assist your search!