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The Value of FOR SALE - 29/04/2008
When considering the value of a property prior to putting it on the market, many sellers understandably look at the asking price of other properties currently on the market locally, and draw pricing conclusions based on this research.
Whilst this is not an unreasonable way of assessing value, there are some traps which many prospective sellers fall into, especially in a price sensitive market which we currently have.
Firstly, an important observation is that if a property is on the market, it is by definition "unsold". An unsold property may or may not be one which is overpriced. So if you have a similar property and you price it at about the same level as the unsold property, then the possibility is that yours could remain unsold as well.
We know that purchasers buy by comparison. So your property has to compare favourably when seen alongside others on the market. If your property is similar to another on the market nearby, then yours becomes readily saleable when it is priced favourably and offers better value for money.
Additionally, if you feel that your property is slightly better than a neighbouring property for sale then it can make sense to quote a similar price, rather than attempting to offset the extra features with a higher price.
Ultimately, correct pricing is all about seeing the world through the eyes of the buyer and making responsible and effective pricing decisions which always point to offering better value than that offered by competing properties available locally.
Next week's article will consider the merits of pricing in relation to properties that have already sold.
