Kelly Koselek

Setting an equitable yet compelling price is key to a successful sale. This is even more important in highly competitive areas such as Toronto. But it can be difficult. Buyers are usually well informed about recent events in the marketplace. They select homes by comparison shopping and are keenly aware of subtle differences in features and value. In their eyes, your price must be justified in comparison to other available homes that they have seen either online or at an open house.

Obtaining the best return for your property requires competitive pricing from day-one. A home should be priced according to recent market data comparisons, not according to your wishes or emotions or what your well-meaning, but biased neighbours think your house may be worth.

There are a number of factors that influence the value of your property:

  1. Prior Sales - the more recent the better
  2. Location - busy street vs quiet residential street
  3. Condition - shabby vs well maintained, renovated
  4. Improvements - beware of over improvements.
  5. Market Conditions – buyers’ market vs sellers’ market vs stable market

Competitive Market Analysis

Taking these factors into account, we will prepare a competitive market analysis to reflect the current market value of your property. It includes an examination of your property as well as a study of competitive properties currently on the market and those that have recently sold. This information helps you to properly position your property.

No Realtor can control market value. The selection of a listing agent should be based on their service, reputation, and experience, not on their estimate of market value. It is the market that determines the sale price you will ultimately achieve. A good agent will advise you of things you can do to improve your house prior to putting it on the market that will ultimately lead to additional dollars in your pocket.

Competitive Pricing vs. Overpricing

First impressions are lasting. A house realistically priced and properly presented from day-one offers the best opportunity for you to sell quickly and obtain the best price. Qualified buyers and their agents have been looking in your area and waiting for a suitable house at an appropriate price to come on the market. If reasonably priced, it is likely your property will sell quickly to waiting buyers.

Competitively priced properties encourage reasonable offers, pleasant negotiations and a smooth closing.

Overpricing costs in terms of money, disappointment, and missed opportunities. If the price is too high, buyers may not even look at an otherwise attractive property.

An overpriced property can go stale after the important first few weeks when the home is new on the market and getting the most exposure. Then, when the price is adjusted at a later time, the house is often overlooked.

Even if you were able to arrange a sale for substantially more than comparable properties – beware! It may fail to close through difficulty securing an appraisal and mortgage financing that corresponds to the overinflated value.

The Paradox of Price: When the 'price is right' buyers get involved quickly and sellers gain a competitive advantage. Use the paradox of price to your benefit. If you have the will to set a compelling price, the reaction of the marketplace will amaze you.

 

KELLY KOSELEK, BSc, M.B.A. Bus. 416-489-2121 Cell:647-273-7597
Royal LePage Real Estate Services Ltd, JOHNSTON & DANIEL DIVISION, Brokerage