Don’t be Seduced by the Price Wizard’s Sorcery
Mr. Seller has lived in his home for many years and has accumulated a fair amount of equity. Even though property values in his neighborhood haven’t appreciated much recently, Mr. Seller’s mortgage balance has gone down, and he’s made several improvements that make his home more valuable than when he bought it.
He’s also been checking Zillow, and he’s confident he can get more than his neighbors have been selling for during the past year. Satisfied that he knows what it’s worth, he makes appointments with several Realtors to discuss listing his home.
Each agent shows Mr. Seller a Comparative Market Analysis (CMA) of an estimated value for his home. He’s dismayed when they all suggest a price less than what he thinks it’s worth. Even though they show him market trends, similar recent sales in his neighborhood, and that nothing has sold for anywhere near what he’s expecting, Mr. Seller knows he can get more than what they’re telling him. Besides, he has a Zestimate!
Fortunately, an enlightened Realtor shows up. He not only agrees with Mr. Seller’s price, he thinks it’s worth more! He assures him they won’t have any trouble selling for that amount, so Mr. Seller lists with The Price Wizard.
Unfortunately, Mr. Seller just got taken by a dubious tactic known as Buying a Listing. The Price Wizard understands the easiest way to get the listing is to agree to the price. He also understands that when the house hasn’t had much activity after the first month, he can talk Mr. Seller into lowering the asking price, often reducing it many times over the course of a listing. Regrettably, after a house has been on the market for a while, it generates less and less interest among Buyers, and any offers are generally lower than they would have been had it been priced correctly from the beginning.
The simple solution to not being duped by The Price Wizard is to choose a Realtor based on their reputation, ability, knowledge, and someone who can back up their recommendations with facts. Don’t ever choose an Agent because of the price they’re willing to list your property. A credible Realtor will help you get more money from the sale of your home than any Price Wizard can. Choose carefully.