Real estate, Goldilocks and the Three Bears ... Oh my!
If you remember the story of Goldilocks and the Three Bears you will recall that Goldilocks broke into the three bears’ home and sat down to eat some porridge.
The first bowl was too hot, the second bowl was too cold, and the third bowl was just right. What can we learn from Goldilocks?
When homebuyers are looking for a home today, they do not want a home that is too high (overpriced).
Sellers do not want to sell a home that is too low (underpriced).
A sale is made when the home is priced just right (at market value).
Homes that come onto the market garner the most attention in the first 21 to 30 days that the home is listed for sale.
If the listed price is at the market value, the chance of a successful and timely transaction increases dramatically.
On occasion we hear the seller quip, let’s put it on the market at this price and let’s see what happens. The result is there is nothing to see because nothing happens.
A home, particularly in today’s market, but in any market, that is not priced appropriately has little chance of getting many showings or receiving an offer. And the consequence of overpricing in the first 30 days is that the home has missed the strategic time frame when most attention will be directed to it.
Frequently, the seller’s emotion gets in the way of the logic of sensible pricing. A seller should abandon their personal point of view and rely on a research process to determine a viable pricing strategy. A real estate agent will provide a comparative market analysis that will show the selling price history of homes that are similar to the seller’s.
Another factor to consider is the average square foot selling price of comparable homes that are nearby. Lastly, the current market conditions must be considered. These three criteria are the starting point for a pricing analysis.
A home inspection is done almost 100 percent of the time by the buyer and may lead to further negotiation by the buyer if there are significant defects in the home. The seller may consider a pre-inspection by a home inspector to correct defects prior to receiving a sales contract. This will help the seller get top dollar for their home.
Goldilocks knew which porridge was just right and so do today’s informed buyers.
Ray Pugel is a designated broker for Coldwell Banker Bishop Realty. Contact him at (928) 474-2216.