A pre-sale appraisal is a valuable tool in helping determine the listing price for a home.
Some of the benefits include:
Gaining an independent opinion of value that is free from the thoughts and opinions of the seller, buyer and agent. It helps set the price correctly in the beginning. Homes that are priced right from the beginning sell quicker.
Having an advantage with the back-end negotiation. When the buyer wants to offer a low-ball price, then the appraisal can be shared to help increase the price.
Offering the appraisal after an out-of-market appraiser on behalf of the buyer appraises the house. Sometimes their appraisal will come back with a value lower than the final selling price. Your appraisal can be shared and used to help increase the price. Statistics have shown that offers for sellers can increase thousands of dollars once your agent shares the pre-sale appraisal with the buyer agent.
Getting more offers. If you overprice your house, you will get fewer offers.
Gaining more enthusiasm and trust from other agents. If an agent sees a house that is overpriced, he or she is less likely to show it to clients and won’t spend as much time on it as they would a house that is priced correctly. They won’t show your house as frequently because they don’t want to lose the trust of their clients.
Attracting the right buyers. Overpriced houses tend not to attract qualified buyers.
Fitting into financing perimeters. Financial institutions and mortgage companies finance only a percentage of the real value of the house. If the house is overpriced, they usually will only finance a lower percentage, ultimately reducing the available financing options.
Getting the most of your advertising dollar. If the house has an inflated sales price, it won’t get as much response from advertising, reducing the effectiveness of the advertising campaign.
Achieving a quicker sale at the right price. If you overprice your house, interest declines because buyers and their agents know it’s overpriced. In the meantime, you are still paying mortgage, utilities and maintenance during the period that it could have been sold.