How to Price Your House Right, Real Estate Update

Last month I wrote about selling your home in the summer time - - since the summer started, there have been 128 new listings and 105 contract sales in Basking Ridge, proving that homes do sell in the summer time!  What really makes that happen though is pricing the property to meet the market.

Proper pricing is sometimes very easy to determine – for example, when comparing properties in Spring Ridge, Hamilton Woods, or Patriot Ridge, where there are lots of sales and similarities between the properties, if there is data to review, it's easy to see the trends and determine a good list price.

With unique homes, or traditional homes in unique or challenging locations, it can be difficult to determine the right list price. In those cases, often the best thing to do is to get the house listed and then listen to the market. 

Analysis shows us that most sales happen within the first 30-40 days of a new listing or within the first few weeks of a price adjustment; an adjustment that gets the list price to within 5-6% of market value.  Sometimes though, you just don't know what market value is until you hit the list price that brings in the buyers in – the serious buyers who recognize the value and make a reasonable offer.

There was a time when a big REDUCED sign on a property was a bad thing – we are definitely not in that market anymore.  There is no reason to believe that a price adjustment is indicative of a problem property – it's simply indicative of a problem price!  And luckily, problem prices can be fixed!

I spent some time this month looking at the listing history for all the sales that closed in July in Basking Ridge (see attached photo for spreadsheet).

I reviewed each listing and for those that had had price reductions, I adjusted the days on market to count from that change to when a contract was negotiated (in some cases I used the attorney review start date, in some cases I used contract date – depending on which data was available, and assuming that the difference is negligible).  I found that the average adjusted days on market in Basking Ridge for the July closings was right around 40 days.  Although this is a small sample, it definitely supports the statement that when a property is priced correctly, it is likely to sell within a month's time.

Location, Location, Location – that's the real estate mantra, right?  Well, given that Basking Ridge is one of the best locations in the state (we aren't biased, are we?) we've already got that covered.  The only thing we really need to consider is Price, Price, Price…

Jennifer Blanchard is a sales associate with Weichert Realtors in Basking Ridge. She writes a real estate blog at http://basking-ridge-real-estate.com/blog.