Pricing Your Home To Sell in a Correcting Market

You can still get top dollar if you price your home correctly.

If you’ve been paying attention to housing market news, you’ve probably heard about decreasing sales, rising interest rates, and increasing inventory. Do these factors mean we’re heading for a housing market crash? According to the experts, the answer is no. Instead of crashing, our housing market is correcting.

During the crazy housing market caused by low-interest rates and the increased flexibility of remote work, prices skyrocketed. In fact, the average home price increased by 10.2% from July 2021 to July 2022. The truth is that the crazy pandemic market wasn’t sustainable. According to Moody Analytics, 210 metro areas were overvalued by 25% or more.

If you’re looking to sell your home soon, what does this all mean for you? Fortunately, we’re still in a sellers’ market, but you have to be careful about how you price your home. If you make the wrong move, your house could sit on the market for a long time, and you may have to decrease your price.

In a correcting market like ours, it is more important than ever not to price your home too high. If you do, you could end up “chasing the market.” In this scenario, your initial price is too high, and buyers won’t look at your home. You could try lowering your price, but by that point, the market may have changed again. This is a sellers’ worst nightmare—if it happens, you may even have to take your property off the market and try again later.

One strategy that works in a shifting market is to price your home slightly below market value on purpose. It seems odd, but this will guarantee that your home is the most attractive deal in your area. If everything goes according to plan, buyers will flock to your house, and the competition among them will naturally bring the price up to or above market value. The risk with this strategy is that if only a few buyers come to your home, there might not be enough competition to drive up the price. However, this is a fantastic option if you need to sell quickly.

“We’re still in a sellers’ market, but you have to be careful about how you price your home.”

Of course, you can always work with a real estate professional to look at comparable sales in your area and find a Goldilocks price—one that isn’t too high or too low, but just right. This can be difficult to do on your own in a correcting market, but professionals have access to market data that will make the process much easier.

Finally, you can use an incentive to attract buyers. One of the best strategies I’ve found in this shifting market is to offer a 2-1 buydown. Essentially, you offer to pay some of your buyer’s closing costs, and they use that money to pay down their interest rate for the first two years of their mortgage. So if your buyer’s quoted rate is 6%, it will be 4% the first year of their loan and 5% the second year of their loan. Since so many buyers are worried about high-interest rates right now, this incentive will entice buyers to give you a better deal.

The bottom line is that sellers can still achieve fantastic results in this market as long as they do their research and price their homes correctly. If you would like to discuss which strategy might be best for you, don’t hesitate to call or email me. Make it a great day!

Jeff Lang

REALTOR®

Primary phone
(650) 766-6412
License Number
#01221669
Email
[email protected]
Address
1440 Chapin Ave,
Burlingame, CA 94401

About The Author

Jeff Lang's career in real estate is a testament to his strategic, growth-oriented mindset and his dedication to helping clients navigate the unique landscapes of San Mateo County. With his focus on areas from Burlingame to San Carlos and Pacifica since 2011, Jeff has become an invaluable asset to those seeking the perfect balance of urban and suburban life. His appreciation for the county's temperate weather and easy access to a plethora of outdoor activities resonates deeply with his clientele, who seek both the vibrancy of urban living and the tranquility of suburban spaces.

Beginning his journey in commercial real estate in San Francisco in 1997 and later transitioning to residential real estate in La Jolla, Jeff has honed a deep understanding of the industry. Known for his professional, caring, and patient approach, he brings a results-oriented and responsive attitude to every transaction. Jeff's unique strength lies in his ability to outperform competitors by leveraging his extensive experience and education.

Jeff leverages his education having received his JD and an MBA, alongside numerous real estate certifications including Master Certified Negotiations Expert and Certified Luxury Home Marketing Specialist, enabling him to devise winning strategies for each transaction. His approach not only ensures success but also puts his clients at ease, earning their trust and loyalty.

Outside of real estate, Jeff's life is as dynamic and multifaceted as his professional pursuits. His hobbies range from trail running and hiking with his dog to playing golf, tennis, and pickleball, and he's an enthusiastic Peloton user. A proud graduate of law school at the age of 42 and an Ironman triathlon finisher, Jeff's achievements speak to his determination and commitment. These qualities, combined with his professional expertise, make him an exceptional choice for buyers, sellers, and investors—especially in the $2m+ range—who are looking for more than just a transaction but a partnership with a seasoned expert who will turn them into raving fans.

In his over two decades in real estate, Jeff is most proud of partnering with his clients to build the life of their dreams. It helps that Jeff is a negotiations shark, having competed nationally as president of the negotiations team in law school and as a Master Certified Negotiation Expert (MCNE). His MBA and JD also give him and his clients a competitive advantage in every transaction, leading to his listings selling for 4.8% more than the average San Mateo County agent and offers getting accepted 6x more frequently.

If you are looking for an agent who will take on your goal as their own and be relentless in their pursuit of achieving that goal, then you want Jeff as your partner. He’s completed five marathons, including one in Antarctica, and dozens of triathlons, including an Ironman. His passion for taking on a challenge and grinding away to craft creative solutions is unparalleled. Jeff has a natural talent for putting things in perspective, keeping your eye on the prize, and clarifying the strategy to provide opportunities for success in your transaction.

A few of Jeff’s other certifications include NAR’s ePro for advanced digital marketing and NAR’s Green Designations for sustainability in real estate, Pricing Strategy Advisor (PSA) certification, Keller Williams’ BOLD program, and Tony Robbins’ Mastery University. He is also a member of the Institute for Luxury Marketing. These help him and his clients outpace the competition by selling at a higher price and getting offers accepted more often. This track record and partnership continue to provide repeat and referral business, the basis for his growing business.

Reach out to Jeff for a free consultation to discuss your real estate goals. He would be happy to make your goals his and utilize his extensive experience to make it happen.