Selling our home can become a complicated task. And it is that in America it usually takes an average of 10 months to sell a house. The more difficult it will be and the longer it will take if the house price is priced well above the market value.
As we already know, price is key to selling a home, and a correct sale price must be set up front if we are not to greatly delay the sale of the home.
We tell you some mistakes that we can make when setting the price of the house and that can give us some other problems.
Setting a price too high to be able to negotiate
In America, more than 50% of homes for sale start with a higher price than they should. This is a very common mistake that we can make, thinking that this way we gain margin to negotiate the sale price and be able to lower it later in a negotiation.
Nothing is further from reality. This overvaluation will only drive away interested potential buyers during the first few months. What we can even promote is to sell the neighbor's house if it has a more appropriate price. In the absence of interest from buyers, we will have to lower the price. In the end, after several months on the market without receiving offers or with repeated price reductions, the house “burns”, giving the impression that it has some major drawback or defect.
Today, buyers are well informed about the real estate market and have numerous tools available to compare and find out if the house is priced appropriately. The closer you are to the market's true home value, the more interest buyers will have in the home, and therefore, the closer you'll be to selling it. Therefore, setting an appropriate price from the first moment is key to the sale.
Pricing too low to sell the house quickly
It seems logical to think that putting a house price below the market price, the sale will be assured. Everything will depend on factors such as the demand that this type of house has in those areas, in addition to logically the state of conservation of the house.
On many occasions, a very low price can convey the feeling that something is happening with that house , and seeing a price that is outside the usual market can lead to no offers being received for the home. After all, the price is merely a perception.
Another mistake would be to set a very low price as a claim, hiding other additional costs that the buyer would have to bear, such as large reforms or extra expenses in the neighborhood community. This tactic often has a deceptive effect .
In addition, it is convenient to know the tax implications it may have to sell a home for an amount less than its cadastral value. A real estate agent will help you know these costs.
Set a price for financial gain
Many sellers hope to make a big profit from the sale of their home. Obviously, it will not always be this way, and the fact of obtaining a profit will depend fundamentally on how much the owner paid for it.
Currently the average price per m2 of housing is around 1,500 $ for second-hand housing. From the price trend of the real estate market, we can see that if the house was acquired in the middle of the real estate bubble, where the price per m2 reached 3,000 $, it will be difficult for us to profit from its sale. If the house was bought in the 90s, where the price per m2 could be less than 500 $, it will be easy to make a profit.
In this sense, we must take into account the tax expenses that we will have to pay due to this capital gain. Broadly speaking, we must pay the Personal Income Tax and the municipal tax or capital gain.
Said profit is calculated based on the difference between the value at which the home is sold and the value at which it was purchased, updated by a coefficient that varies depending on the year in which the home was purchased. It is advisable to go to a real estate advisor to inform us, since many of these expenses will depend on the town where the house is located.
However, we can also obtain economic benefit from the sale of the house after carrying out a small reform that gives added value and revalues the house. A house in good condition sells better than an old one, and the price of these renovations is not as expensive as we might think.
Set a price and be inflexible in a negotiation
Most buyers are going to want to negotiate and bid on the price. Being flexible when negotiating that price will be a differentiating factor to sell the house.
This flexibility does not necessarily translate into reducing the price of the home, but sometimes it is enough to offer other benefits to the buyer such as including accessories, equipment or furniture, or taking care of a small reform.
Nor is it a question of lowering prices little by little, since buyers may perceive that the seller does not have a limit on the price drop.
Therefore, the negotiation skills and experience of a professional real estate agent will be key to making a good sale. They know more than anyone at what price similar properties are being sold in the same area, and therefore, they will know how to advise you on the right sale price.
Trying to sell a home on your own can become a difficult experience. In order not to waste time with ineffective negotiations or make mistakes with inappropriate prices, it is advisable to go to a trusted real estate agency that achieves a successful purchase-sale operation.
