The 3-Step Plan to Setting your House Asking Price
26 Feb 2019
Putting your house up for sale is one of the biggest financial decisions you’ll ever make.
There’s no simple way to do it. Overvalue in your haste to win big and your home could get left on the market. Yet underestimating a property’s true value leaves many sellers coming away short.
Here’s our guide to navigating the asking price process and making sure you get what you deserve for your home.
The price balancing act
There’s no exact price for any one house but rather estimatedmarket value ranges, which vary over time and across valuation providers.
Many features of the property itself affect its price – things like location, structural quality and expansion potential.
Yet many externalfactors also impact how much buyers are willing to pay. These include:
· Demand for homes in your area outweighs the number of properties for sale (currently happening in Leicester– read more about that here.)
· Interest rates increase, making mortgage payments more expensive and buyers less willing to fork out on higher house prices.
Overcoming every seller’s pricing urge
No two agents will price your property in the same way. Ultimately however, it’s yourather than the estate agent who has the final say on your asking price.
It’s easy to get excited by a higher-than-expected price suggestion. Yet listing your property even slightly too high is more likely to end up being a costly mistake. Overvalued properties usually sit on the market for longer periods, eventually selling for significantly less than the initial asking price. Which? research has suggested that sellers have lost out on as much as £4.3bn through overvaluing by estate agents.
Instead, set aside some time to follow our 3-Step Plan, to ensure you get the best deal possible:
Step 1: Pricing
Determine & verify the best price estimate for your property.
Assess the (local) market
It's important to look at localhouse prices rather than national averages when working out how much your home is worth. Property markets can vary widely across the country, even within a single county.
The Land Registry is a good place to start, where the prices of all recently sold property can be searched by town, street or even individual houses.
Judge trends over time
It's also important to look at sales over time, as you can usually set higher asking prices for properties that have been increasing in value.
Rightmove have a searchable market trend database where you can view average property prices over the last 6 months in any postcode area.
Get a free valuation
Our no-obligation, Free Valuation will give you an independent, objective estimate of your property’s value.
Bring in the experts
A reputable estate agent, with expert knowledge on local price variations, will be able to help verify your desired asking price.
Mortgage providers also undertake property valuations. However, recent reports suggest that lenders often suggest lower-than-expected figures. The difference in valuations by an estate agent and a mortgage provider can be as much as 20% of the property’s value.
Online Estate Agents work transparently to determine the best asking price for you, providing clear evidence to justify their figures.
Step 2: Price-Setting Strategy
Decide on the pricing strategy most suitable for you and your property.
Set a Fixed Price
The most popular approach to selling a property is by setting a fixed asking price, which potential buyers either accept or try to negotiate. Being confident of your property’s true value is essential as most buyers will try to negotiate down and you should be well-prepared to adjust for that.
This indicates to buyers that they should place offersabovethe figure stated and can be a successful tactic in good local markets. With a lower-than-expected price, your property can be found more easily on property portals. However, buyers who don’t want to get into an auction-like situation can be put off, alienating people who might otherwise be interested in making you an offer.
“Offers in the Region”
Specifying a range between two prices helps guide buyers towards the figure you’re looking for while also remaining open to a wider audience. This can attract more interest from buyers, and there’s always the chance of achieving a higher offer than expected without overvaluing. However, you could also face alienating buyers.
Step 3: Agreeing on a Price
Navigate offers and negotiations to reach the price that works for you.
Pressing go on listing your property can be nerve wrecking. The first few weeks are crucial and if you receive little interest it’s likely your property has been priced too high. You need to turn this around quickly before buyers start to grow suspicious of a house that’s been sitting on the market for too long. Our local experts can help you do this here.
Once offers start coming through, your estate agent will carry out checks on the buyer. It’s then up to you to either reject their offer, wait see if a better one comes in from another buyer or try to negotiate it upwards. Your estate agent can advise on opportunities for price negotiation with each buyer.
Negotiation is a critical part of the process. If offers are slow you can counter low bids with a higher figure. Many buyers make low offers because they believe it’s a routine part of the process, are worried about overpaying or simply want to try their luck and test your limits.
Accepting an offer is notlegally binding and you do nothave to take your property off the market once an offer has been made. You can still change your mind or accept a higher offer at any point before contracts are signed and exchanged.
If you need advice on pricing and marketing your property, get in touch
https://onlineestateagents.com/online-estate-agents-contact/with our local experts today.
Find out the value of your home for free with our online valuation.
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