The Top 6 Reasons To Price It Right

Incorrectly pricing an apartment for sale can be counter productive for the seller. Here are some of the most important reasons why:

1) An appraisal becomes problematic. If the buyer needs to get a mortgage the bank will have the apartment appraised. The sale will only close if the contract price is reasonably near recent closing prices.

2) The intimidation factor. "...This is such a high asking price. There's no way the owner will negotiate to a level I can agree to...". Fewer buyers will make offers on an over priced apartment. This is a counter productive situation for a seller who wants multiple offers and the highest price the market will bear.

3) The missing search. Buyers using the web will not find listings priced out of a reasonable search range. One example would be a studio asking $700,000. Few buyers are looking for studios asking this much.

4) Credibility. Under pricing an apartment can also be an issue for sellers. Buyers may interpret this as an indication either something is seriously wrong with the apartment (i.e. it's in awful condition, completely dark, etc.) or the size has been misrepresented; "...This can not be a real one bedroom. The price is so low that it's either a mistake or this apartment is really a converted studio....". If an apartment is to be "under priced" to try to spark multiple bids the ask still must be set correctly as part of the overall presentation.

5) Increased time on the market. An incorrectly priced apartment will probably take much more time to sell. The longer a listing is on the market the less credibility the asking price will have. Certain types of apartments also have a peak period of interest during the year. Missing a window like this can be costly.

6) Helping the competition. One of the classic tactics is using an incorrect higher ask price to help sell other apartments. A savvy seller will encourage a buyer to look at specific other properties because he knows the comparison is favorable.

The credibility and accuracy of a Real Estate ad will determine whether it's the start of a viable relationship between the buyer and seller or the conclusion. An incorrect asking price is an obstacle that causes many buyers to distrust the seller making an already challenging process more difficult. A savvy buyer understands that many over priced and badly presented apartments eventually sell at a discount because the seller runs out of time, money and patience.

The question now is not why it's important to price correctly; it's how to.