Pricing it too low may prolong the short sale process and pricing it too high, may turn off potential buyers. With a careful market analysis by a short sale specialist, aggressive pricing can save you time and money.
Pricing your home for a short sale is the first and most significant component to closing the sale. Pricing it too high, will not attract buyers. Typically you may find that some short sales are actually priced a bit under market value. The reason for this is to give the buyer some incentive to stick around through the process. Or if the property is less desirable, the reason for the price reduction is to give the buyer, typically an investor, some equity upon completion of the sale. Investors are typically prepared to carry the burden of extra risk and in turn are rewarded with equity. Sometimes you’ll find the listing price on a home is considerably less than current market value. Occasionally this can be due to the length of time its been on the market, indicating negotiating turmoil; or it could indicate housing prices have increased since initially listed. Pricing your home and staying current on values will allow for a quick acceptance from the bank if it is in line with current market trends and conditions.
Pricing your home too low, may create an influx of offers, but they may not be accepted by the bank. At the end of the day it doesn’t matter how many offers you have, if the bank won’t accept them! Also, if you price the home too low, you may lose credibility with the bank, which will be crucial from the beginning to end of this process. Furthermore pricing it too low may indicate to potential buyers there is something inherently wrong with the home.
In this current market there are several types of buyers each with their own benefits and drawbacks. Knowing your home and current market trends is crucial in communicating confidently with the bank. Just because you’ve submitted an offer doesn’t mean your job is over. The banks may call and counter and in that instance you must know where the trends are and where your home fits into them.
Ask me how I stay on top of market trends around homes I am managing. Know the current value of your home? Are the home values increasing or decreasing in your neighborhood? Call Jennifer 916.230.3880 to find out! For 11 more potential short sale pitfalls get your FREE REPORT, SELLERS BEWARE at http://JenKlein.com