Selling your home for the highest price and in the quickest time
This is undeniably every seller’s goal, yet with volatile micro and macro-economic factors such as interest rate hikes and municipal developments it is not a simple task. Or is it?
According to Craig Hutchison of Engel & Völkers Southern Africa, a correctly priced home will always sell. “Property will forever be a good investment; though the demand may drop from time to time, house prices will increase over the long term without fail. The trick comes in understanding the current market influencers and area specific trends well enough to place a market-related price on a home. This requires an educated and objective approach to property”
According to Craig the simple fact of the matter is that buyers purchase homes by comparison, and if a property is over-priced compared to other properties in the same league, the chances of selling are slim. Just by putting yourself in the shoes of the buyer will assist you in gaining the right perspective on the selling process.
So how, with so many factors influencing the market, can a home-owner ensure that they price their property to sell? The answer: Work with a trustworthy and qualified estate agent. Property IQ and market savvy are part and parcel of a property sales advisor’s credentials. It takes experience, research, objectivity and a lot of leg-work to properly price a home, so enrolling the expertise of a trained property professional is probably the best advice. Far from leaving it up to the agent to get the right price though, it is imperative that you have a hands-on involvement in the process in terms of knowing what is being done to get the right price.
The pricing process:
The pricing process is summed up in a document called a CMA or Comparative Market Analysis which will give you a comprehensive overview of the recent and current market trends in your area and how your property relates to these activities.
Here are some of the key factors your estate agent will look at in order to determine the market related price of your home:
Properties recently sold. Looking at similar properties sold in your area over the last six or so months will give a good indication of both the current rate of price increase as well as a indicated true market price as properties currently being sold will most likely show slightly inflated figures. It is important that your agent takes into consideration the price the properties were sold at, not marketed at as the difference between the two could be vast.
Properties currently on the market. It goes without saying that a comparison needs to be done with properties currently on the market as these are the very same properties potential buyers will view just before or after they view yours. Buyers tend to shop around in the area they desire to live in and will tend to choose the best value for money to meet their needs, so there is very little point in setting a price that is higher than competing properties of similar value. Be careful of looking at current property advertisements to try and gauge a price for your property as homes always sell for less than the advertised price.
Your property. Once an analysis has been done on properties recently sold in the area and properties currently for sale, your agent will do a breakdown of your property along the same criteria which will afford you a clear indication of where your local market is at and in which price bracket your property should fall. A good agent will include in this analysis the positive and negative selling points of your home and will advise you on how you could improve its value, as well as inform you of elements that may bring down its price. Proximity to arterial roots, accessibility to amenities, noise levels and structural soundness are but a few of the many factors trained specialists will be able to identify and properly analyze for you.
The final step is to decide on a single price at which to market your property. “There is a very simple rule that will assist in defining a property’s selling price.” Says Craig “Set a price that is above the recent market indicators (analysis of properties recently sold), and a price which is below that of competing properties to ensure a quick sale (properties currently on the market).”
In a property market where buyers are highly informed and increasingly hands-on in the buying process, it is imperative the houses are priced right and that sellers are equally engage, involved and enlightened.
“The negative effects of over-pricing simply aren’t worth the risk” says Craig, “the end result is that the property is sold for under its value and in a protracted period of time. A correctly priced property in the current market sells in 2 – 6 weeks at market value, while a property, which market perception has been damaged through overpricing, could take up to 4 months to sell at under market value. Today’s buyers can tell value for money and reject anything less – outright. They form negative perceptions of houses that are on the market for a long time and quickly write off ‘unstable’ investments’”.
It’s good to know then, that as the market stabilizes there are estate agencies of repute in your back yard who have highly trained specialists ready to employ their expertise and experience to assist homeowners in understanding current trends in order to align with the market to ensure that they sell their homes at the best possible price and in the fastest possible time!