The AtlantaPros Team Online Listing Presentation
Fair Market Value
Fair market value is determined by what a reasonable and informed buyer searching in your home's market would pay.
How do Buyers determine what they are going to purchase and for how much?
- Shopping around and becoming familiar with the market
- Comparing available properties
- Selecting the best value they can find based on the current market
If your property is overpriced, it may be used to make competing homes seem more attractive. If a property is over-priced, the number of people who will see the property is reduced and as a result the likelihood of an acceptable offer is also reduced. Before you can start the negotiating process you must first have interested buyers viewing your home.
| Asking Price in Relationship to Fair Market Value |
% of Potential Buyers that would Consider Viewing the Property | Pricing Strategy |
| 10% Over Fair Market Value | 2% | Speculative Pricing |
| 5% Over Fair Market Value | 30% | |
| Fair Market Value | 60% | Competitive Pricing |
| 5% Below Fair Market Value | 80% | |
| 10% Below Fair Mraket Value | 92% |
Aggressive Pricing |
Three Home Pricing Strategies:
- Speculative Pricing - Risky for the Seller
Overpricing originates from the belief that a seller can always "come down" in price. While it appears to be a conservative decision, it actually fosters great risk:
- Statistically showing activity decreases when a property is perceived as being over-priced for the market.
- Buyers that may be qualified to purchase at fair market, may not view a property if it is out of their "qualified price range."
- It lowers the critical "new inventory" excitement level.
- The home is more likely to be perceived as "stale inventory" or "shop-worn", even after a price reduction.
- The price can't be justified by an appraisal for financing even if an offer is made, so the potential advantage is eliminated.
- Longer time on the market often results in a lower selling price than would have otherwise been attained.
- Aggressive Pricing - A strategic tool:
When property is offered below market value. This can be a useful strategy to encourage a fast sale, will generate the greatest excitement when exposed to the market and is the most likely to draw multiple offers and while potentially still selling for fair market value, this property will sell in the shortest amount of time.
- Competitive Pricing - The Pricing of Choice
- Allows room for negotiation without sacrificing exposure
- Maximizes early weeks of peak interest and activity of new listings
- Attracts more potential buyers in targeted price range
- More likely to attract higher offers than speculative pricing strategy
- More likely to attract multiple offers than speculative pricing strategy
Next:
Our Comparable Market Analysis (CMA)
- Our Complete Market Exposure
- Three Critical Factors to Selling Your Home
- Our Fair Market Value & Pricing Strategy
- Our Comparable Market Analysis (CMA)
- Our Other Listing Services
