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🔑 The key to a successful home sale? Understanding pricing strategies! 🏡✨
Many clients tie their identity to the list price of their house, but it's essential to disassociate that. The list price is just an invitation—a strategic move. Here's how I break it down:
1️⃣ Aspirational Pricing: Listing above market value, leaving room for negotiation. Perfect for unique or celebrity-status homes (but not always necessary).
2️⃣ Perceived Market Value: Listing based on current comps to attract fair offers. It's not about fair market value until the deal is closed.
Transcript:
The number one thing we need to help our clients understand is that they put the identity of themselves into the list price of the house, right? But instead, if you disassociate the sales price and list price, then they know that the list price is just an invitation. It's a pricing strategy. Now you can say, hey, there's three broad pricing strategies that we use. The first one's called aspirational pricing. It is when we list a little bit above where the market is and we lose leave some room for negotiation. The only time we use that is when the home is extremely unique or it has some celebrity factor that doesn't apply to us. In this case, I know what I'm doing, right, so I'm taking that option off the table for them. The second is what a lot of people call market value pricing. Actually, there's nothing like fair market value. Fair market value. Fair market value is only determined or the property actually closes. We call it perceived market value. What would the current comps be in this and so when you actually listed this price, you actually get a lot of fair offers. And the third, which is often my favorite strategy, is what I call event based pricing, where you list a little bit below market and you create an auction like environment to drive the price up. Since we don't need the aspirational pricing, we're left with these other two. Which one connects with you the most right now? Now they didn't choose the price, just using the strategy. They choose a strategy, I choose the price. Yeah, right. And so now they're like, they feel like they're in this game with me.
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