In previous entries, I've talked about the importance of pricing a home "right" for the current market. If a home is not priced right, it sits on the market for many days, and usually has at least one price reduction before selling. In contrast, when a home is priiced right for the market, it is on the market for a shorter period of time, and it does not require a price reduction to sell.

 

Here's an actual case study that demonstrates the importance of pricing a home right.

 

About 14 months ago, a home sold for $285,000 in a northside neighborhood in Bellingham. About 45 days later in the same neighborhood, another home was listed for sale. This home was nearly identical to the home that sold for $285,000. But the listing agent and sellers decided to list this home for $299,000, just $14,000 more than the home that just sold for $285,000.

 

The newly listed home sat on the market with no offers. After about two months, the price was reduced by $10,000, and still it didn't sell. This went on for about a year. After 10 price reductions, the home sold for $189,000, about 12 months later.

 

So, this home sold for narly $100,000 less than what a comparable home sold for, and was on the market for about a year. All because the home was priced just slightly about the fair market price. Home buyers are very smart. They easily notice when a home is priced too high for the current market. Missing the right price by even a few percent can result in the home selling for far less, in this case nearly one-third.