Recent news suggests that the housing market may finally be cooling off a bit. CNBC reports that there is significant damage to demand for real estate as mortgage rates continue to climb and fears of increased inflation remain present:
According to various surveys, rising rates and overheated home prices, which are now up over 20% from a year ago, have crushed affordability. Home sales have been dropping for several straight months, and the fall is expected to worsen.
No one wants to put themselves in a position where they get stuck in a far more expensive home than they can reasonably afford. However, those who are already homeowners may be looking for a way to get themselves out of the house they already own. Despite all of the headwinds that sellers may now face, it is important to still look to get the best possible price for your piece of property. You do not want to sell yourself short because of fear or panic.
Set Your Price at a Reasonable Level
When new houses in Morris Plains come on the market, they are quickly compared against the other listings in the same area. Buyers are always interested in finding a deal, and this means that they are scouring the listings all the time to comparison shop different homes. You will want an accurate home valuation before setting your price. Not only is this helpful for determining what your home may be worth, but it also helps you decide where to set your price based on comparable listings nearby.
Perhaps you have heard of the concept of "comps pricing." This is when a particular home is priced based on the comparable homes in the area. One always wants to ensure they do this because you don't want to have a home priced significantly above every other house in the neighborhood. If you price your home well above what everyone else is asking for, you have a very big chance of overpricing yourself and ending up with no bids.
You must be completely honest with yourself now and ask what you would actually pay for your home. You must take away all of the emotional attachments to the house that you have and try to determine what its actual value is simply as a dwelling. When you do that, you will start to form a picture in your mind about how much you should list the home for.
Price Points Matter
One of the oldest tricks in the book used at retail and grocery stores is to price an item at a price point that will attract more business than a slightly higher price point would. For example, pricing something at $3.99 draws more buyers than pricing it at $4.00. The difference is one penny, but the visualization of the "3" right off the dollar sign plays a powerful psychological trick on our minds.
Similar tactics work in the housing market. A home priced at $239,999 will generally draw the same attention as a home priced at $237,999. It doesn't matter that the second offer is $2,000 less expensive. However, if you were to drop the price to $234,999, you may draw in quite a few more potential buyers. Morris Plains properties that are strategically priced like this tend to move a bit faster than those that are not. Psychological trick or not, the fact that these strategies work is something that should not be ignored.
Similar tactics work in the housing market. A home priced at $239,999 will generally draw the same attention as a home priced at $237,999. It doesn't matter that the second offer is $2,000 less expensive. However, if you were to drop the price to $234,999, you may draw in quite a few more potential buyers. Morris Plains properties that are strategically priced like this tend to move a bit faster than those that are not. Psychological trick or not, the fact that these strategies work is something that should not be ignored.
People want to pay a price that they feel is reasonable, and certain numbers sound more reasonable than others. Try to anchor your price just below 5's and 0's to get the most eyeballs on your property.
Hire a Tough Agent
Most people think that when they hire a real estate agent, the agent should always be on their side and should almost coddle them through the process. However, this is a very destructive idea if your overall goal is to get someone that you know will be able to sell your home for you.
What you actually want is an agent that isn't afraid to offer two-way critiques of your home.
An agent that offers this service can help by:
- Pointing out flaws in the curb appeal of your home
- Helping you understand what your home is truly worth instead of what you want to sell it for
- Encouraging you to reconsider your marketing tactics
- Talking sense to you if you are about to accept a less than optimal price for your home
Much of this is challenging to hear for people with houses in Morris Plains, NJ, but they need to listen to it because it is the truth. If someone doesn't explain these concepts to them, then they are not going to learn. This cycle may repeat itself repeatedly, with the homeowner being disappointed every time if they don't understand that their agent is merely attempting to provide them with the sound real estate advice they need to hear.
Throw in Some Incentives
Are you working with one or more potential buyers who seem to be on the verge of making an offer? If so, you might want to give them a little push in the right direction. You can throw in some incentives to sweeten the deal and get them to finally make good on the potential offers that they have left dangling out in the open.
A couple of incentives that might work include:
- Paying their closing costs — Closing costs are an extra bit of money that buyers typically have to pay as they finalize a real estate transaction. People don't like them because they feel like getting kicked in the teeth on the way to finishing up a deal. Perhaps you can offer to pay their closing costs to get them to sign on the dotted line. It is a little extra money out of your pocket, but if it helps finalize the deal, it all seems worthwhile.
- Taking care of inspections and repairs — Any homebuyer who is doing their due diligence will make sure to order an inspection of your Morris Plains real estate before they agree to purchase it. They need to do so because they want to ensure that there aren't any repairs or building code violations that need to be taken care of before making their purchase. Those inspections cost money. As a sign of goodwill, you may offer to pay for a final inspection to help get this potential buyer closer to buying your home.
- Prepare certain services — There are some nifty services that you can prepare to make potential buyers feel more at home from the moment they walk in the door. For example, you might consider covering their Internet bill for the first year they live there. Some people also offer to pay homeowners association (HOA) fees or even get a buyer a membership to a local community club to help them feel right at home. This expense is minimal compared to the cost of the house, but it is a great way to show warmth and care towards your prospective buyer.
It is best to try to determine what kind of incentives may work best for the prospective buyer you are dealing with at the moment. Obviously, the answer will differ from person to person, but you can learn a lot by spending some time with them and seeing their interests and how you might be able to incentivize them.
Move on if a Particular Prospect Doesn't Work Out
Here at Jennifer Pickett real estate, we have a large portfolio of Morris Plains homes we try to move for our clients. One of the lessons we take away from each client that we work with is that sometimes it is best to move on quickly from a buyer who clearly isn't going to work out. If you get the sense that someone isn't serious about purchasing your home, you should try to move on from that person. There is no value in sinking more time into someone who clearly doesn't care if they waste your time.
The buyers who are serious about purchasing your home will make themselves known quickly, and you will be able to make a decision based on a steady stream of offers if you focus on the real candidates. We suggest that you avoid time-wasters even if they are the first people to have shown interest in your home since it was put on the market. If you try to entertain everyone who comes to see your property, you will ultimately run out of hours in the day. Learn to move on, and you will capitalize on the people who are serious about your properties. It is as simple as that.
Visit Jennifer Picket Real Estate for the Best Advice on How to Sell Your Home Today
You can do yourself a great service by visiting the Jennifer Pickett website today to get the latest advice on how to sell your home for top-dollar prices today. We always keep up with the latest tips and advice to help our clients understand how they can still sell their properties for a significant amount of money even as the market does whatever it is going to do. Visit us today and start learning more about your next steps!