When South Lake Tahoe real estate inventory is considered a seller’s market due to low inventory, a lot of homeowners have the idea that they can price as high as they want. After all, if there are a lot of buyers and not a lot of inventory, people looking for homes for sale in South Lake Tahoe may be more inclined to pay extra if it means they can get their dream home. While we understand that mentality, it doesn’t quite work like that. In fact, ask any South Lake Tahoe Realtor and they will tell you that pricing your home according to market value is the most important step you can make when you list.
Truth is, when you price according to comparable solds, which is South Lake Tahoe real estate that is similar to yours that has actually sold, you are pricing it based on the actual market value. The actual market value is determined by what people are actually willing to pay. We see a lot of seller’s who think their 20 year old 4 bedroom house with no updates is worth the same as the brand new construction with 4 beds across the street and request to list at that same price point. In most scenarios, it simply does not work like that. Think about it from this perspective: If you had the option to buy a brand new home that was move in ready and didn’t need any upgrades for the same price as the older, outdated home across the street, which one would you pick? Probably the brand new South Lake Tahoe real estate! When determining list price, your South Lake Tahoe Realtor is the best person to advise on what this number should be, based on the current market conditions. If the process it takes to create a custom market analysis isn’t making sense, feel free to ask your Realtor how it works so that you feel confidant when picking the magic number.
One thing to note is that when you price right at the South Lake Tahoe real estate market value, or slightly below, you increase your listing’s visibility which drives more buyers to your property. When searching for homes for sale in South Lake Tahoe, buyers usually set a max price which populates homes at that range or below. If your property is priced higher “just to see what you can get”, you miss qualified buyers who are actually in the market for a home just like yours. Additionally, when you price a little lower than market value, you have a bigger opportunity as far as attracting multiple offers. When multiple offers come in, the bids usually drive the price up a bit which means you could close over asking. This always depends on the market, the home in question and demand. Your South Lake Tahoe Realtor will be the best person to suggest whether this tactic is a good move for your property.
A lot of sellers wonder what the harm is in pricing higher than a property’s worth. Homes for sale in South Lake Tahoe that are priced higher than their value run the risk of sitting on the market too long and accruing an extended days on market. When this happens, potential buyers assume something is wrong with the home (after all, why hasn’t it sold?) and don’t bother scheduling a tour. If you insist on testing the market and seeing what type of response you get, have a strategic plan with your real estate professional on when you will reduce and by how much. Pricing right is the big difference in getting a competitive offer and in a timely manner.
If you are thinking of selling this year, be sure to work with your local Realtor in Lake Tahoe. If you do not have one, we would be happy to help!