In talking to several potential clients this past week, I have explained that there are two sets of buyers we need to consider when preparing to list, market and sell your home.
The first set of buyers – on the sidelines, ready to pounce . . .
Depending on the price range of your house, location, and other attributes, there may very well be a buyer searching for your home right now, and not finding it because you have not yet listed it for sale. In many local housing markets, inventory is low compared to a year ago, so some would-be buyers simply aren’t able to find the house they would like to buy. Thus, we need to have your house in great shape and ready for several very serious, very interested potential buyers who may show up in the first few weeks of having your house on the market
The second set of buyers – actual and contemplative buyers, over time . . .
If we haven’t sold your house in the first month of being on the market, in some ways we are then gearing up for the second set of buyers — those who will be deciding to start looking for a house over the next few months and will then be perusing a wide range of houses as they determine what they are looking for, what they like, what they don’t like, etc. This second set of buyers (who are stretched out over a longer time period) are not typically as specifically interested in your house as those first few buyers are who may show up in the first month of having your house listed for sale.
So we should aim for the first set of buyers, right?
Certainly, nearly every seller would like a buyer to commit to buy their home in the first few weeks that it is on the market. That is not always possible, but we can make that the goal depending on a few variables.
Some houses are in under-supplied locations, neighborhoods or price ranges such that there will be pent up buyer demand, increasing the likelihood of a speedy sale. You can’t move your house, or adjust many of these attributes, however, so we’re either going to have supply and demand working in our favor, or not.
You do, as a seller, have some control over pricing. The key here is to ask slightly less than what buyers will see to be a reasonable price. Conventional pricing strategy might suggest that we identify the fair market value of your house (for example $300K) and then price your home slightly above that (for example $310K) to allow for some room to negotiate. The problem with this strategy is that it doesn’t make it compelling enough for buyers such that they’ll want to act immediately upon seeing your house on the market. In this example, we’d be much better served to price your home at $299K such that a buyer can imagine being able to buy your home for $290K or $295K, and thus is willing to make an early, fast offer.
There is plenty that goes into preparing your house to go on the market, and understanding the segment of the local housing market that your house fits into, but one serious consideration is how to best position your home for the two sets of buyers described above.