Setting a property sale price

Posted on 05 November, 2013 in Selling Property

Owners often ask how agents go about establishing a fair and realistic asking price for a property they are looking to sell.

Well there is quite a lot to consider as a professional agent doesn't just pluck a figure out of thin air and hope they got it right or tell the owner what they want to hear in an effort to get their business.

My first step would be to examine all recent sales of properties comparable in area, design, structure and location. With this information, I would prepare a comparative market analysis showing the number of sales in a suburb, properties currently on the market in that suburb, time on the market for all properties sold and for sale as well as the demographics of the suburb. Information such as the land size, type of improvements are also listed on the report making it easy to compare the subject property to what has sold or currently on the market.

Other considerations would be the state of the current market along with economic issues such as interest rates and finally the owners needs or timeframe. The idea of starting high to give yourself room to manoeuvre should be considered very carefully as it has potential to cause more harm than good. Most people have to borrow in order to buy and their financial institution usually demands a valuation of the property to be carried out. This is to ensure the price being paid is what the property is worth and the buyer is not paying too much thus exposing the bank.

Once I have conducted my market analysis I would present my findings to the owner and together we would discuss the current market data and decide on a price that would endeavour us to obtain a good price in a reasonable timeframe.