Denver area sellers can become frustrated with today’s strong “Buyer’s Market” conditions. Last week I was at a listing presentation of a high end home and the seller wanted to be sure he priced his home aggressively to ensure the home sells within a 90 to 120 day maximum marketing period. His suggestion was to price the home right at “fair market value”. – He just did not have the time to “play around”.Most listing agent would be excited to hear this from a potential seller. How easy can this be? But, my advice was NOT to price his home right at today’s “fair market value” for the home. My reasoning is simply that ALL buyers today know the market if flooded with anxious sellers. They and their agents also know there are deals to be had out there. Any agent worth his/her commission will want to prove that fact to his/her client when it comes time to negotiate the final contract price.
So, assuming the property is priced at exactly the “fair market value” and at the seller’s absolute bottom price, how do the selling agent and buyer negotiate a better price? One that feels like they won in today’s strong “buyer’s market” conditions. Forget the fact that the buyer would actually be getting the home at a great price with no effort with my seller’s approach to pricing. The real problem here is that the buyer and the buyer’s agent just won’t have a good feel about the negotiation process if they don’t know they won. Anytime a buyer pays the full asking price in our market, the buyer will never feel like they won. Can you imagine the reaction the buyer would get when they told their family, friends and office acquaintances that they paid the seller's asking price on the home they just purchased?
So, how should a seller price his metro Denver home? My answer was to allow enough negotiating room on the price that the eventual buyer AND the buyer’s agent could feel like they won in their negotiations. The percentage amount the asking price should be above the seller’s absolute minimum acceptable price will depend on the condition of the home and the number of competing listings in the immediate area.
As a seller in the Denver market place, just be sure to factor in the “good feeling factor” for the buyer and the buyer’s agent.
You can find excellent negotiation strategies articles on my DenverRealEstateOnline.com web site.
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1 comments:
If you start too high, slowly lower the price gradually until they are sometimes lower than they should have started with from the beginning. Knowing this from the beginning and in advance can save money and save frustration.
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