When the real estate market is HOT and it's a seller's market - you might list your house with the hopes of getting MULTIPLE offers. Here are some strategies to make that come true!
This is part 3 in a series. You can watch Part 1 of the Home Pricing Strategies here. And Part 2 of the Home Pricing Strategies is all about what to do if you don't get any offers at all.
If you're curious what your home is worth you can check that out at http://515homevalue.com.
In this video, we're going to continue talking about pricing your house and how to get multiple offers or a bidding war.
Perhaps you'd like to sell your house for more than list price.
Well, you and me both. So how can we orchestrate that to work in your favor?
Well, you could list your house at market value and you could give yourself time to market it, to get the most amount of exposure in the shortest period of time that would hopefully generate multiple offers.
You could also list your house below market value. And I personally don't like this strategy. So the idea of it is if we list your house in 15% below market value, 90% of the buyers on the market, are going to be looking at this house, and we are sure to get a bidding war.
But what if you're wrong?
It's much easier to lower the price than it is to increase the price of your house for sale. I think that it is much more wise to list your house for sale in the market value range. And you could start at the top of the range. We want to get the most amount of money for our customers.
So you and I are on the same page that we want to get you the most amount possible for your house. Unfortunately, what you and I think doesn't really matter in the long run because buyers, the person who's willing to write a check for your house, they're the ones that set the price. Granted, you don't have to accept their price, but you see how this works.
Knowing the real estate market is pretty hot, I would list in that market value range on the high end of the market value. And I would do a first offer review period. A first offer review period may have another name. I believe I coined that name and I just made it up.
So in my opinion, a first offer review period is if you list your house for sale on Friday, you say, Hey, we're going to review any and all offers on Sunday at five o'clock. So now buyers have all of Friday, all of Saturday, most of Sunday to schedule an appointment with their agent to come in, look at your house, have a minute to breathe and think and decide if this is really the house that they want to write an offer on.
Chances are, if you have a house that is very popular and in a competitive price range and you've priced it well, and it presents well that you might get multiple offers.
There are more pros than cons to a first offer review.
The con being "what if we don't get any offers?" Well, then you very quickly remove the first offer review period from the listing and just proceed as though nothing happened.
But also take that as feedback that maybe your house isn't quite presenting at the value that you want it to, or maybe the market isn't as hot as you think it is.
Maybe your property is not in a very competitive price point. Meaning if there's a lot of houses, just like yours on the market at the same or lower prices, then you may not be the unicorn that everyone is looking for.
Or you might just be priced too high and need to adjust. There's lots of reasons why your house would not sell. So talk to your agent or hit me up and I'm happy to have that discussion with you too.
So the pros of having a first offer review period:
- agents have time
- buyers have time
- there's less buyers remorse that happens
- people are going to know that you're looking for strategic offers
- they're likely to present their best offer, which may or may not be the highest price, but their best offer
- maybe they'll waive inspections
- maybe they'll waive appraisal.
Maybe, maybe, maybe, maybe lots of things can happen, but you're giving them the opportunity to be strategic about it. And everyone knows the rules of the game of buying your house.
How can we get lots of people to offer? I'd like a bidding war.
While that first offer review works also to set yourself up for a bidding war, but remember it only takes one offer to sell your house. So who cares if you have multiple offers on the house, as long as you have that one that does the trick and gets your house sold.
Maybe you definitely want multiple offers. There are some agents who really like this strategy of underpricing a house in order to get lots of offers. I'm not that agent, but some agents will support you in underpricing your house. The idea is that you list it 10%, 15%, who knows maybe even more under market value.
And in theory, your house will never sell for less than market value. The market won't allow that to happen because somebody will outbid the other person, but that's still a pretty big risk. So it is one way to accomplish your goal of having a bidding war.
But the risk is that the price you get, even with a bidding war may not meet or exceed the price you would have gotten had you priced it at market value to begin with. So, pretty big risk.
And that's how that this last question is answered too - someone I know got 40 plus offers. How do we do that? Well again, if you underprice the house and you attract all of those offers, I've seen those houses who get the 40 plus offers. And sometimes when I look at what it sold at, I can't believe what a great deal those people got.
Even with 40 some offers, even with the theory that the market will never allow you to sell your house for less than what it's worth. It's a big risk. Honestly, I question that the agent is really doing what's in the best interest of their client in that particular situation.
Just know that if that is the strategy that you choose, there's no guarantee that it's going to get you the most amount of money at the end of the day.
And that's it. That's how you can strategically price your house for sale in order to attract the most offers as possible. And hopefully get that bidding war that you want. Although remember, just because you have multiple offers, doesn't mean it's going to be easy because you might pick the wrong offer. That's a video for another time.
If you are thinking about selling your house, you can always go to 515homevalue.com and get an instant home valuation to see how much your house is worth. Now that's my computer telling you how much it thinks your house is worth. But when you're really serious, you want me to come out with a human brain and tell you what your house is worth, market value. And then we can strategize about what is going to work best for you to get your house sold, to meet your goals.
A lot of the strategies that we talked about in this video are also not going to work for the person who has a priority of time. Somebody who needs to sell their house fast is probably not going to have time for a first offer review period. If you have a subject to sale on your next house and you need to take offers right now and get it sold right now, then that is a totally different strategy. And frankly, a different video because we have run out of time on this one.
If you would like more information about living in Des Moines, moving in Des Moines or selling real estate in Des Moines, visit my website MyWrightHouse.com. I'll talk to you soon.