Mistakes Sellers Make When “Pricing” Their Property
If you are reading this, it means that you are probably trying to sell your home or is considering to do so. You are reading the right article because I am going to give you insights on how to price your home right and avoid costly mistakes that MANY sellers (and even agents) make.
I am not just going to throw out ‘tips’ or ‘jargons’, I intend to show you a real case study of a five-room HDB flat at Woodlands that I sold recently at $526,000, which is $11,000 ABOVE valuation and $76,000 MORE than a recently-transacted neighbouring unit. And mind you, this is sold during the on-going pandemic where the market is supposed to be ‘bad’.
So the question is, how did I help my seller to achieve a record price? Was it a coincidence? Or was it because we were super ambitious? The answer is no. There are no magic tricks in property selling. There is, however, ways to help you ensure that your home is given the best opportunity to achieve its best possible price. The question next is – who determines the value? Is the seller? The agent? The bank? Past transactions? Or the buyer?
All of the above attributes to the final selling price, but the MOST important factor is to understand the demand and interest level. The bank evaluates your home based on metrics and data, but the truth is cost and worth are very different things. You can never put a price tag to something that you really like and want. So it all boils down to whether if your unit truly what home buyers are looking for? You never know until you try to find out.
And this is precisely the whole point of this blog post. Most home sellers tend to rush to sell their home – ‘always take the first offer’, many agents would advise. But how true is that? What if the offer is way below your expectations? Do you just take it as it is? OF COURSE NOT.
But how do you benchmark the expectations? The bank valuation? What your agent tell you? Past transactions? If I were to follow all these, I wouldn’t be able to sell that unit above the valuation price and its neighbour.
I have a very simple technique that I apply when I am helping my sellers market their unit. It’s called the TRA Phase. This technique is tried and tested and has helped me sell hundreds of homes in the past 10 years of my career in the property market.
TRA Phase stands for Test, Response and Analysis. With the sale of any property, it’s essential to be aware of the stages that attribute to the final transaction. It’s not just listing it on property directories or posting it on social media. These are just tactics and channels that any agents (even you) can do. But what TRA sets itself apart is to have a clear strategy in place. An approach that ensures that your home is properly valued according to the demands of the marketplace.
The Testing Phase is where you get a sense if your unit is in demand or not. This is when you can possibly push the boundaries and test the response, and that’s exactly what I did with my seller. I told them that after considering the different factors (I use a Simple 4-step Property Assessment Tool), we could list the property at S$540,000. This is again, S$76,000 more than a recently-transacted unit at a block next to us.
And guess what? Within the FIRST week, we received close to 10 enquiries and even got an offer of S$526,000!
Could we have gotten this if we went with past transactions and did not attempt the Testing Phase? Absolutely not. In fact, most agents would get you to price it ‘sensitively’ so you can sell off quickly. I wouldn’t do that to any of my sellers because I would put myself in their shoes; this is a huge transaction, and you want to make sure that you’ve got the best deal, no?
Dont’ rush it into the process – understand how your home is truly valued by putting it through the Test Phase. And of course, it needs to be carefully assessed with the right tools and techniques. More importantly, find an agent that will truly act in your best interest. That includes telling you the hard truths about your property and putting things into simple but clear perspectives for you. Of course, I would hope to be that person to guide you through this stressful process. I am very confident that with my experience and the tools that I have, we can get the best possible result. So if you are selling, planning to sell or need a fresh perspective, drop me a message or a call. I will do my very best to make this process an eventful and stress-free one, just like what I did for my previous clients!
Good luck and all the best in your property journey!
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