How to price a home in a rising market? Episode #314
How to price a home in a rising market
Todd: Hello. Welcome to Todd Miller TV joined here today with Oana who has no idea what I’m going to ask her.
Oana: I never do.
Todd: Never do. OK. So, how to price a home in a rising market.
Oana: Got it.
Todd: Because of shortage of inventory.
Todd: Let’s talk about a pricing strategy for somebody who doesn’t have to sell right away. Meaning, you’re not a short sale in fear of getting foreclosed. You’re moving in six months but you have until maybe the summer or something. So you have some time. Tell me about how to price a home the same way as in the normal market.
Oana: No, absolutely not. So what’s interesting about the market here in Las Vegas right now is you’re looking at the sale prices even the sale prices in the past week or a couple of weeks in your neighborhood, and they’re going – the chances are, it would be lower than the list prices that have accepted offers right now in your neighborhood.
Oana: So what does that tell you? That tells you that we have a lot of pricing pressure. Buyers are willing to pay more for houses because there is no inventory. So, if your home sold today, it would sell for x but if your home sold maybe 60 days from now, it would sell for x plus y.
Todd: Our light just went out. That’s why it’s kind of dark. So keep going.
Oana: It’s mode lighting.
Todd: Mode lighting.
Oana: OK. So the point is look at your neighborhood. Look at the pricing trends of the homes that are listed and have accepted offers. Those are better idea of the value of your home than the sales because remember, sales are looking back. They’re looking at values were 30, 60, 90 days ago when those properties got accepted offers while the properties that just got accepted offers, those are priced at current market value. So that’s what’s really important.
In Las Vegas right now, that could mean anything between $5,000 to $20,000, $30,000 depending on what price point you are with your home.
Todd: How do you know when a property goes under contract and it was the neighbor and sits under contract for 140? How do you really know? I mean it was listed at 140 but how do you what it’s really under contract for? How to price a home?
Oana: Well, you don’t know but you’ve got a pretty good idea that that property got an accepted offer at 140 within 30 days or less. If it did, then it probably got an accepted offer pretty close to 140. If it took longer than that then it probably got an accepted offer for a lot less price. So remember, the longer a property has been on the market at a specific price, the more likely it is that it received an accepted offer far below the list price. So the less time there is between that price and accepted offer, the more likely it is that that accepted offer is close to list price.
Todd: What about calling near the other agent and going, “Hey, I’m going to be taking a listing in the neighborhood. I’m trying to get a feel for prices. Where do you under contract for?”
Oana: Some agents will tell you and some will not. A lot of them won’t for actually very honest reason. The reason is as I like to say, it’s not over until the deal records at the County Recorder’s office.
Oana: So, I don’t tell people what a property is under contract for because it may fall out. I had a property fall out literally the night before we record it. It was a cash deal and the buyer got cold feet the night before we record it. She had already wired all her money title and everything. So like I said, it’s not over until it records so I don’t want to give away what my seller’s bottom line is with the property so I’m probably not going to tell you.
Todd: Hey, we have light again.
Oana: Let there be light, yes.
Todd: Let there be light.
Oana: So look, it’s a volatile market. It’s a fun market. Pay attention to where the accepted offers are at and price your property somewhere close to those rather than lower that keeps pace with the sold properties.
Todd: OK. So, listed properties or tend to be listed more than the recent sold are maybe a better indicator of how you’re going to sell.
Oana: Absolutely, yes.
Todd: OK. Thank you. How to price a home.
Oana: You’re welcome.
Todd: All right. So I just want to share How to price a home with you. That is my update for today and hope to see you on another video. Thanks.