Your Propertys Asking Price
With all the gloomy media coverage currently, if you have had your house on the market for some time without success, dropping your asking price may seem an inevitable, if unwanted, next step. Your estate agent will often suggest this move if they have run out of ideas, motivation and most importantly, confidence in your asking price due to external influences.
But is dropping your asking price really the answer to selling your home more effectively?
It’s true that for some properties, reducing the asking price can generate new interest from buyers who would have been previously unable to afford your home. It’s also a step that for some sellers is, unfortunately, necessary – if they have an urgent move, for example, or are facing repossession.
However, with many houses – particularly premium homes – dropping your asking price is not always the answer, and it can even harm your chances of attracting a committed buyer.
Whilst recent weeks have seen a pause in viewings, buyers have simply been waiting in the wings for an opportunity to view new homes as they come to market deeming those already ON the market as unsuitable. This week we’ve noticed an increase in buyers who are ready to offer, and willing to move quickly. As we move into the full blown Autumn market you will want to take advantage of this current heightened demand, now is the time to review your asking price and decide whether to stick to it or reduce.
If you’re considering reducing your asking price, make sure it’s necessary and the reduction will make a positive difference to your chances of selling your home quickly.
To help guide you, we’ve compiled the DOs and DON’Ts of dropping your asking price to help you get the result you want and move on with your life:
DO consider a Pricing Strategy
– Changing how you present the pricing of your property can be an effective way to stimulate new interest without changing your target selling price. If you have been using a traditional ‘Asking Price’ or ‘Guide Price’ you might want to try flipping this on it’s head using a pricing strategy instead. Instead of listing your property at or slightly above the price you want to sell for, make it more enticing to buyers by reducing the figure by 3-5% but using an ‘Offers in Excess’ strategy. This only works if you stick to the 3-5% and ensure your property is correctly valued in the first place.
DON’T drop your asking price by less than 10%
–Or it just won’t make any difference to the interest you get. Buyers will usually look at homes 10% either side of their budget anyway, so you’ll need to reduce your asking price by at least that to get your home noticed by a new set of buyers.
DO ask your agent why you need to reduce
– Your home was originally valued based on sound research and by an expert in the local property market. What’s changed? Understanding whether your agent misjudged the market, or the demand has changed for houses like yours, will help you make the right decision to either reduce or to stick it out.
DON’T keep making small drops in price
– A price drop can cause suspicion amongst buyers who may wonder what’s wrong with it? Why have you lowered the asking price? A buyer may not want to risk buying a house that seems to be falling in value. A property with lots of historical price drops is inherently unattractive to a buyer, as each drop can signify a red flag, so make your price drop big and impactful, but make it just once. Or try the pricing strategy already mentioned above.
DO drop to the next Rightmove price band
– You can find these by going to www.rightmove.co.uk and entering a search. The list of price band that comes up is your guide as to the price your house should be marketed at. For example, there’s no point in having an asking price of £399,999 when the Rightmove price band is £400,000. By positioning your asking price in alignment with the search bands, your house will effectively show up in up to twice as many buyer searches. This is also important whn using an ‘Offers in excess of’ strategy. There is no point listing at Offers in excess of £999,999. Most buyers at £1M or above won’t even see this due to the way the price bands work on Rightmove.
DON’T try to break the price ceiling for your road or area
– Not only does this make buyers jittery, it will also make a surveyor nervous too. Unless you really can’t avoid it, try to price your home at less than the highest price sold in your neighbourhood. [Note: we have previously sold homes at prices that have broken the area ceiling, but they do need careful positioning to reassure buyers and surveyors, so please ask our advice if this is your situation too.]
DO ask your estate agent the right questions before you drop your price
– If you’re feeling pressure from your estate agent to reduce, or you have a moving deadline looming and can’t afford to drop your price, ask your agent what else could be done to secure that sale, other than reducing your asking price? Have a review with them and look at your marketing critically. Could it be improved? Maybe new lifestyle photographs would attract new buyers. Or showcase your home better with a ‘twilight’ image or aerial shot, to show your home in a new, imaginative way.
DON’T give your buyers an excuse to make a low offer
– Make sure your home is wonderfully presented, with every room polished and attractive, otherwise you’re literally leaving money on the table. Home styling can dramatically increase the ‘saleability’ of your home, and really helps buyers envision the lifestyle it offers. If you’d like to know about the home styling we offer as part of our marketing, we’d be happy to talk you through it and show you some of our styled photographs. Just drop me an email at email@example.com and I’ll arrange it for you right away.
DON’T forget to calculate your price per meter squared
– It can be a more accurate way to value a house than other methods. Not only this, but a good surveyor will use a price per square foot or meter squared analysis to provide a valuation to your buyer and to your buyer’s lender. If your agent hasn’t already done this for you, make a spreadsheet of the other properties for sale and sold in your area and calculate the price per square foot of each, then compare it to yours. If you’d like our help to create your price per square foot/m2 table, or you’d like our template to get you started, just email me at firstname.lastname@example.org and I’d be glad to do this for you.
DO remember that sometimes it’s more valuable to you to be able to move on with your life, than to hold out for months – and sometimes years – for a few thousand pounds more. If time is not on your side, whether it’s a selling deadline, or a pressing personal reason for selling in a particular timescale, it may be time to let go of your price expectations, and time to start your new life chapter. Only you can make this challenging decision, but if you’d like to talk it through with me, I’m here to listen and guide, if that would help. You can reach me on 01271 410108 – just ask for Nic Chbat, for a chat – in confidence.
When your home hasn’t sold and you’re wondering if the price is to blame, use the above DOs and DON’Ts as a checklist to see if you’re doing everything you can to get your house sold. If your price per square foot/m2 is about right, you’re not trying to break the price ceiling for your area, and your home is presented in the best way possible, if your photographs showcase the lifestyle of your home, and you have time on your side to wait for the price you really want, then have confidence in your price. Because if you don’t, no one else will.
Your asking price isn’t the end of the story; it’s the opening chapter. Having a strategy in advance will save you emotional stress throughout the process and offers the reassurance of having a plan to fall back on when and if things get tough.
Uncovering the reasons your home hasn’t yet sold can help you make the challenging decisions at the right time for you and your personal circumstances, and I can help you discover these reasons with an initial chat. Just drop me a line at email@example.com or call me on 01271 410108 and ask for Nic Chbat – and let’s get you moving onto the next chapter of your life.