THINK LIKE A BUYER
THINK LIKE A BUYER
You’ve looked at your agent’s comparable market analysis, calculated how much you need out of selling your home, and have come up with an asking price, but before you sign on the dotted line think of how buyers will react. Based on how buyers typically choose homes, will they feel your home is really worth the asking price?
How Buyers Shop
Buyers look at affordability first and foremost. Most are already preapproved by a lender and know exactly how much they have to spend. Whether it’s with their agents or online, buyers shop in price ranges – typically in $25,000 increments. With that in mind, it’s far better to price your home at $399,995 or $424,900 than at $405,000. Your job is to make sure the buyer who is qualified to buy your home, will actually see it. Next to pricing, buyers look at all available inventory and compare your home to others currently on the market. When home inventory is high, buyers have more room to negotiate terms. When fewer homes are available for sale, buyers are more likely to meet your terms. Buyer’s choices are then narrowed onto a short list, based on what they perceive to be the best value – the best homes in the best condition, and in the best neighborhoods they can afford.
Determining Your Asking Price
It’s important when using comparables to determine your asking price that the homes are close in proximity, similar in size, and appearance to your home. You must also strongly consider current market conditions. As markets rise and fall, buyers can only negotiate based on current market values. This means, a buyer who wants a home in a particular neighborhood may choose one that’s in less than perfect condition if the price is right. Other buyers may opt to compromise location in order to get a larger home, or one in better condition. No matter the situation, buyers always choose the home that offers the best price, condition, and location for the money. Just as you want the most money possible for your home, your buyer wants to pay the least amount of money. The buyer isn’t interested in how much you paid for the home, what you paid for upgrades, or how much money you need to make from the sale. They are only interested in whether or not they want those features and whether or not the home is worth the price you’re asking. Look at your home as critically as you can. Take the time to fix broken items and make your home more attractive with fresh paint, new carpet, and updated fixtures. You can’t change your home’s location, but you can change it’s condition and make your home more competitive for the price.