It's one of the least favorite meetings that a Atlanta home seller can have these days---Reviewing the comps to either set the list price for their home or to determine if a price reduction is necessary. Despite assertions that claim otherwise, an agent can't set the price for your home; the market sets the price. Rest assured that buyers will let you know what they think by their actions. They may tell you the kitchen is too small or the backyard is too steep, but what they are really saying is, "the kitchen is too small at this price". Don't fret. They are not rejecting your house, but rather they are rejecting your price.
Three major factors affect if and how quickly your home will sell: 1) Price 2) Condition 3) Exposure. Far and away right now, price is the single most important factor. This is why it is so important to look intensively at the comparable home sales in your area---to see what is pending, what has expired, what has been withdrawn, and what is currently active (your competition). Here are some other thoughts on the wonderful world of pricing and price reductions:
- Do your research: Before you prepare yourself mentally to sell your Atlanta home, take a long look at the area comps. You may be shocked at what price Atlanta homes similar to yours are selling.
- Come to grips with your home's value: Your home is not worth what it was 2 years ago, 2 months ago, or possibly even 2 weeks ago.
- Price it right from Day 1: Ideally, it is best to have your home priced effectively from the day you list the property. Use a CMA (Comparative Market Analysis) to determine what buyers are currently paying for a home similar to yours.
Embrace your "newness": Take advantage of being the "new" thing on the market. Many buyers have searches set up that will email them if a home comes on the Atlanta real estate market that meets their criteria. Everyone wants to see the "next new thing" that just came out so take advantage of this exposure by being priced correctly from the beginning.
- Try to remain unemotional: This can be very difficult to do since it is not a house for sale to you, it's your home. It's the place where you raised your kids and made so many wonderful memories, but as much as possible you need to treat it as a business transaction to get the best results.
- Use a hatchet, not a butter knife: I know it hurts, but the homes that are selling right now are those that are priced effectively either at or below market value. Consider making a large reduction instead of several little ones.
- Be quick when making price reductions: Nickel and dime reductions tend to be perceived by the market as the home having something wrong with it.
- Don't chase the market: If you aren't priced correctly in a declining market (which Atlanta currently is), you'll always be "chasing". When you finally decide to make your price reduction, the market will have already moved (probably further downward) always keeping your price above the market levels.
- Pricing too high may take money out of your wallet: It may seem counter-intuitive, but pricing your home too high will probably cost you more money in the long run than if you just priced it based on the market from the beginning.
- Shout it out: When you make a price reduction make sure your home's price is updated in all locations (all websites, MLSs, etc) and tell everyone who has had an interest in your home in the past about the change. This goes for anyone who has shown the property, even if they weren't "interested" the first time around. This sounds like obvious advice, but you'd be surprised how many people/agents don't do this. Facebook and Twitter are great tools for letting your network know about pricing changes. As your friends, they have an active interest in helping you sell your home. Make sure they know about it.