One of the most difficult decisions to consider when selling your home is what asking price to market the property at? We asked Chris Fitzakerley owner of one of the biggest sales and lettings agencies in the North East of England, his opinion on the matter.
The following post is provided by Chris Fitzakerley of Gateshead Property Online.
Estate agents may suggest different figures and there is more than one price strategy to list your property. These include ‘Offers in the Region of’, ‘Offers Over’, ‘Guide Price’ and many others.
When it comes to considering the right price, if the price is too high the property may not sell. Equally, you do not want the price to be too low as you will get less than the property is worth. Finding a balance is key if you are to attract interest in a reasonable time frame.
Once you are ready to sell your home, arranging valuations by estate agents (ideally at least 3 so you can take an average) is usually the first step to deciding on an asking price. However the agents are only able to advise, you will have the final decision on what price to go for.
Once you have your valuations, it is always best to do your own market research by looking at similar properties for sale and recent sold prices in your area. You should be aware that it is common for estate agents to suggest unrealistically high asking prices in the hope that you will instruct them. It is always best to check agents’ valuations. Key things to consider are how long similarly priced properties have been on the market for and how long they are taking to achieve those prices.
When you are conducting your own research use websites like Rightmove and Zoopla to find out how much other houses in your area or street have sold for or the prices they are currently being marketed at. You can also find out how long properties have been on the market for. This will give you an indication of how long you may need to wait for a sale at the asking price you select.
You can also use Nethouseprices to check recent sold prices in your street and the surrounding areas.
One thing to consider when deciding on an asking price is most buyers assume that you will be willing to negotiate asking prices. You can adjust your asking price by 5-10% above what you would be happy to get for it to reflect this.
Another important point to think about when selecting an asking price is if a buyer would need to pay stamp duty at that price. If they would then look at the amount they would need to pay. If you can price the property to limit the amount they will pay this may assist you in receiving more interest or a quicker sale.
One final thing to consider when deciding on an asking price is how long you are prepared to wait for a sale. If you want or need to sell quickly you may want to consider a lower asking price than the area average. Estate agents can advertise this by saying a property is “priced to sell”. By advertising this way you are more likely to attract more buyers and you may attract cash buyers. Cash buyers can typically conclude transactions more quickly than buyers who are purchasing with finance.
If you are not in any immediate rush to sell you could trying starting at a higher asking price initially to establish if the property receives any interest. If it does receive interest and offers at this price than you know that you are likely to achieve a sale at this price range. However you should be prepared to lower the price if the property does not receive any interest.
Depending on their time frame many vendors choose to gradually reduce the price over time until the property finally reaches a price it will sell at. One thing to consider with this approach though is if the property is on the market too long potential buyers may question why. This can lead buyers to believe that there is something wrong with the property and they may bypass it. According to Rightmove, currently the average time to agree a sale is 72 days. Ideally you should try and aim to achieve a sale within 6-12 months and wherever possible avoid the property being on the market for more than this time.