Pricing your home right

Private Property South Africa
Julia Hinton

One of the main reasons why a property doesn't sell or takes a long time to sell is because it is priced too high.

If you are considering selling your home you may be wondering how to settle on an

asking price for your property.

Pricing to sell

Pricing your property realistically at a market-related price is one of the most

important factors for a successful sale. Buyers shop for a home by comparing

your home to other properties on the market - both in terms of price, position

and what the property has to offer. Starting with a realistic asking price

creates a demand and allows you to maintain your negotiating advantage. It is

important to remember that price is the main negotiating factor for your buyer

and that the first impression makes all the difference.

The pitfalls of over-valuation are that unrealistic pricing results in

over-exposure and prospective buyers are quickly lost. If you receive little or

no interest in your property there is a good chance that your price is too high

with the danger being that your property may become stale. This wastes valuable

marketing time, creates much stress and ultimately if the sale becomes urgent

you may end up accepting an offer at a much lower price.

If you are deciding whether to sell privately or use an estate agent you should

always be careful of an unscrupulous agent promising you an unrealistic price.

They may want your sole mandate so might be telling you what you want to hear.

It is advisable to stick to one method of marketing your home. If you choose to

sell privately through Private Property then give it at least two months before

exploring other avenues. Marketing your home through a number of channels can

end up giving buyers mixed messages, which is something you should definitely

avoid.

Your first offer is often your best offer. Be careful not to assume your

property is under-priced. In many cases early offers are turned down and sellers

eventually end up selling for less.

Tips for helping you establish the price of your property

Online valuation tool

Many people rely on an estate agent to guide them, but what do you do if you

have decided to sell privately?

If you decide to sell your home privately through Private Property, a consultant

will provide you with a comparative market valuation to help you establish what

price to market your property at. This includes a SPI (Sold Price Index) report,

which is Deeds office information, as well as data on properties in the street

or area that have recently been sold through Private Property.

Anyone can use the 'Price it right' on www.privateproperty.co.za - simply click

on the link on the left side of the page and you will be able to find out more

about the service and also view sample reports.

For a small fee of R34 per report, which can be paid online using your credit

card you can select one or more of these reports: Street History, Suburb

Transfers, Suburb Proclaimed Town Transfers and Sectional Title Scheme Report.

These reports only give you information on properties that have already been

sold. They do not give you a breakdown of the property features, but are useful

in helping you establish what properties in your suburb, street or complex have

recently sold for. You would need to match this information with your knowledge

of the area and the research you have done on similar properties that are

currently on the market. In other words, compare attributes that the property

has to others on the market.

By using this and other information in the report, you will be able to gauge the

current market value of similar properties in the area, so that you don't

overprice a property you want to sell or pay too much if you are buying.

Local knowledge

Local knowledge of the area is a useful starting point and it is helpful to

begin by comparing the property you are interested in to other similar

properties in the area. Look at newspapers, property magazines and property

websites to get some idea of what the asking prices are for homes with similar

features in the same area. Visit show houses in the area to gauge how similar

properties on the market compare.

Another good way to determine a market-related price for a particular property

would be if you identified five properties for sale in your area with similar

features and compared the asking price. Somewhere in the middle or slightly

below would be a good place to start in setting the price.

Added value features

Identify the distinguishing features that the property you are interested in

has, such as four bedrooms, a flatlet, brand new kitchen, study and so on. Then

look at what the property offers that could be considered to offer 'extra

value'. All these 'extra' features can be assigned a monetary value. For

example, what would it cost to add on a fourth bedroom and third bathroom? What

would it cost to build on a study or add on an entertainment area?

With a general market slowdown in progress it is even more important to make

sure that you price your property right the first time. John Loos of FNB

Property Finance says that the second quarter FNB Property Barometer indicates

that 75% of homes are currently being sold below their asking price and that the

average time it takes to sell a house is now 10 weeks. So do your research, get

to know your local area, and when you put your property on the market make sure

the price is realistic.

Looking to sell your home?
Advertise your property to millions of interested buyers by listing with Private Property now!
List your home privately

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