Here is one path to get you the best price for your home. I recently won a victory in my neighborhood. Despite new construction in the area, as well as agents that like to price houses here very conservatively (i.e. Low), I set a record for price per square foot for my neighbor up the street. This is how I got the best price for their home. We will call this house #1.
Interestingly, another neighbor, down my street the other way, decided to list with another agent, the one who helped them purchase it. This is despite my explaining that I do things differently and am more likely to be able to get you the best price for your home. This is House #2.
When they saw that I was getting ready to list House #1, they decided to put their house on the market quickly and delay showings because they weren’t quite ready. I think they also wanted to make sure they got in buyers’ minds while House #1 was Coming Soon. Not a bad strategy. Here was the problem this presented for me and my seller. They priced their house much lower than I would have expected. They priced it at $379K when, had I been their listing agent, I would have listed it for $400K.
This was a nice 4 bedroom, 2.5 bath house, with a screened in porch, a finished attic space, and a nice fenced yard -perfect for families with kids. It was also a nice size coming in at just over 3000 Square feet. There wasn’t very much on the market like it and it showed very well.
Now House #1 is very nice too, with a renovated kitchen and bathrooms. It also has a nice yard with a great jungle gym in the back. Also great for families with kids, however this house was smaller, at 2600+ square feet. We set the price for House #1 at $375K before House #2 was on the market. We decided on this price because of a few recent homes that had gone under contract for what we thought were good prices. However, as it turned out, appraisers came in and downgraded the prices we had used for comparables after we had already set our price in the MLS. One house that had been under contract for $360K ended up being $352K, another when from $370K to $360K.
Needless to say, the seller and I were slightly nervous because now it was looking like the price we had chosen may now be higher than the market would support, especially with the low price competition of House #2. The reality is that there was a big likelihood that even if we got our price, that an appraiser might come in and nix it for us.
We decided to wait it out, and press forward with plenty of good marketing. This included listing it in the MRIS which reaches all the way from Northern Virginia up to New Jersey and Pennsylvania. We also had a Mega Open House, with great food and entertainment. Our lender, Valerie Easter from C&F Mortgage, was also on hand to answer loan questions for prospective buyers.
Now here is where things get interesting. House #2 did go under contract first, as we expected. Once this competition was out of the way, on our 3rd weekend with House #1 on the market, we ended up having 2 showings with interested buyers.
One of these was a woman who called me and asked if I could show her the property, because her agent was travelling for the weekend. Many agents won’t do this, but I feel it is my job to represent my sellers. If that means opening the door for someone who already has an agent, I am going to do it. This may be the person who buys this house, they aren’t likely to do that if they can’t get in it when they want to. You aren’t going to get the best price for your home if your agent isn’t willing to go the extra mile.
Let me tell you, this little bit of extra effort paid off! This lady was a great buyer. She was preapproved for a loan and had a significant down payment. She also liked the house and decided to make an offer through her agent. Her offer was not quite asking price.
We also had had 2 showings for an out of state couple that weekend, who were also interested in the house. At first, they made an offer that was asking price, but asked for a huge amount in closing costs. With the permission of the seller, I informed them that we had an offer coming in, this one from the lady that I let in to take a tour. At this point, these out of town buyers removed the closing cost request and offered asking price of $375K.
Now we had two very good offers on the table, one for asking and one for just below, both with significant down payments. This is important to note because when a buyer has a good sized down payment, the loan is much more likely to get to closing. I went back to these out of town buyers and asked if they would be willing to remove the appraisal contingency, to put their offer over the top. Not only did they agree, but they changed their offer to all cash! This was better than we had hoped for! Now we didn’t need to worry about an appraiser coming in and lowering our price!
So I bet you are wondering how House #2 faired in its sale during this time. Well, as it turns out, it closed after House #1. They ended up selling for the exact same price as house #1! This is $4k less than their asking price! That results in a price per square foot of $123.48. House #1 got $141.30 per square foot.
Now the question is, who would you rather have sell your house? The agent that is going to go the extra mile to get you the best price for your home? Or the agent that is going to choose a low price because it makes it easy for them to sell your house, with a minimum of effort on their part. These things matter to your bottom line. Choose wisely!