3 Quick Lessons About Pricing in Perth 2016

As the market is in a constant state of change, it seems even the most accurate of agents are wrong. That’s right, they won’t want to hear it, but its the sad truth. Using a recent example, i will explain the value of testing the market, whether via Auction or Expressions of interest method or “Price Ranging”.

Prior to going live on the internet we had professional photo’s taken and marketed the property to our database using this website and Facebook. We gathered a “test group” and priced the property at a level we thought was accurate.

The test price was Offers Over $599,000. We had 15 buyers through the home, but no-one put in an offer. The feedback was that the price was good value (but the lack of offers suggested otherwise).

Upon going live for the first time, we used a range of $580,000-$630,000 (yes a $50,000 range) and the buyers responded in droves, we had 25 inspections on the first open with 6 OFFERS IN TOTAL in 7 days. 4 of the 6 offers were written and all were within the suggested range.

The seller accepted an offer on the 7th day after the market had given feedback on their home and its value in todays market place.

Appraised price $620,000
Proposed Range: $600,000-$650,000
Marketed Range: $580,000-$630,000
Price Accepted: Over Original $599,000 price.

The 3 valuable lessons from this experiment:

  1. Testing the market is worth your sellers weight in GOLD- to them.
  2. Pricing without a “test group” is just guessing – if you’re wrong it will cost your seller thousands.
  3. The best price will be achieved within 21 days of pricing the home.

*Important note 1:The test group MUST be buyers, NOT REPS OR AGENTS.
**Important note 2:The seller and agent must remove themselves from price to truly find out what the buyers think about their property.
**Important note 3:If you do not have a database of buyers for that area, consider Auction or use Facebook to register buyers through your website.

Thanks again for reading and good luck in your buying or selling experience.

Kind regards,

James Baylee

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