The latest installment in our Frequently Asked Questions series tackles a common question that sellers have for us: How do you set the asking price of a property? Setting the asking price at the right point is extremely important. Set it too high, and you’ll exclude a lot of potential buyers from even knowing about the property. (A lot of buyers have searches set up for properties within a certain price range. If your home falls outside their target price range, it won’t show up in their search results.) Set the price too low, however, and you’re shortchanging yourself by taking less money than you could have made on the property. So how do we determine the right asking price?
“Choosing the asking price of a property is as much art as it is science,” explains our founder and principal broker Nicholas Apostal. It’s a process we don’t take lightly. First we meet with all potential clients at our listing presentation, where we get a good look at the home to get a handle on any improvements, upgrades and other factors that might influence the price.
Then we do our research, using comparable recent sales of similar properties in the area to get a sense of what price the market will bear for similar homes. In the Chicago market in particular, this can be tricky. Location is such an important consideration that finding comparable homes within your micro-neighborhood is essential. We then factor in the appreciation/depreciation trends in the area and consider the value of any improvements and the potential for rental revenue.
We use all of these factors to come up with a price range, and then position the property within the price segment where we think it will get the most attention from prospective buyers. We pride ourselves on being honest with our clients and getting them the best possible price. We will never inflate the asking price in order to gain a listing, because in the end that hurts us as much as it hurts the client. And we have a very good track record! As we mentioned in a previous FAQ post, our listings tend to sell within a few weeks of hitting the MLS. This weekend we had two properties go under contract within days of being listed!
Are you interested in learning more about how we set the asking price of a home? We’d love to chat about it. Contact us!