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PRICING EXAMPLE
A homeowner decides to place his home on the market and must decide on an asking price. By rough estimate, the home’smarket value falls between $290,000 and $300,000.Many homes are on themarket. These are some pricing considerations and approaches to finding that “right price”: • The “leave roomfor negotiation” approach. In this approach, themarket value is “stretched,” say to $305,000.The price will not entice a buyer, but maymake comparable homes more desirable. The home will most likely not sell quickly or at that price. • The “price it according to “worth” approach. This approach sees the price set right between the market value benchmarks, at $295,000. Likely, home shoppers will lump the home with like-priced homes, knowing they can buy anytime for $295,000. • The “underpricinggenerates interest”approach. Underpricing at $280,000 will motivate buyers and perhaps create a bidding war. But the goal of selling the home for moremoney is derailed. THE COMPARATIVE MARKET ANALYSIS When it comes to finding a buyer, pricing your home based off of comparable real-priced sales is crucial to making the sale. The Comparative Market Analysis is imperative to pricing strategically. When you ask for one from a real estate professional, be sure to review the analysis, ask questions, and get explanations. If completed correctly, this comparison report not only gives you a great listing price but also reduces the chance of your home being under-appraised. If you have a well-priced home, you should be showing within the first few days on the market. Offers should come within weeks. PERCEIVED VALUE If the perceived value of your home by a potential buyer is greater than the actual price, the more willing he is to buy. The urgency to
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