How should I price my property?

When you’re deciding on a price for your property, do you price it low and set an offer date with the goal of getting multiple offers? Or do you price at current market value and accept offers anytime? That depends on your property, the market – and your agent’s strategy. 

These days, a lot of properties are deliberately underpriced and only accept offers on a certain date – usually a week or so after the listing hits the market. It's a strategy designed to attract more buyers and spark competition. The idea is to build anticipation, get more eyes on your listing, create a sense of urgency – and get a higher price for your property. But an appealing price and an offer date are no guarantee that you'll get the price you want. 

So what's the option that will get you the best price for your property? Ultimately, that's a conversation to have with your agent. 

Not every property should be priced for an offer date

It totally depends on what’s happening in the market, on the location, the building, and a host of other factors. However, if your property is in a “competitive” price range (under $1M for a condo and under $2.5M for a house), an offer date is something to consider. Think of it this way: you want to get as much traffic to your listing as possible. If it's priced at $1M, people with filters set at an $850K max won't see it. On the other hand, if you list at $850K with the goal of getting $1M, you’ll get a bigger audience. 

Why would you want them to see it if it’s out of their price range? Here's the thing: buying a home is a very emotional thing. If a buyer sees it and falls in love with it, they’ll be more likely to find a way to raise their budget. But if they never saw your listing in the first place, you’ve lost that audience. 

So what happens if you price strategically but get only low-ball bids on offer day – or no offers at all? It happens – it’s not the end of the world. I usually counsel my clients to terminate the listing (take it off the market) and relist the next day at a more realistic number. 

Right now, we're still in a seller's market. While things have cooled a bit due to interest rate hikes, demand is still strong and multiple offers are still happening. But that could change, and an agent with their finger on the pulse of the market will know the appropriate strategy and advise you accordingly. 

What happens if you set an offer date but get a bully offer? 

A bully offer is one that comes in before the offer date – and is generally an above-and-beyond price with no conditions that’s designed to make sellers think they couldn’t do better on offer day. As a seller, if you think you can get more, you can always say no. You never have to accept an offer you're not satisfied with. Saying no doesn't mean those buyers won't come back  on offer day, but there's always that possibility. Your agent will advise you, but ultimately, the choice is yours. 

I recently ran into this situation with my clients. It was a very special listing – a gorgeous, one-of-a kind loft in a Victorian church. It was slightly underpriced, but not enough to attract lowball bidders (I always try to price close to market value). Three days in, they got a bully offer for $225K over their asking price. We discussed it together – and decided we could do better. And we were right: those buyers came back on offer day, along with two others. 

After negotiating with all three parties, the bullies improved their initial offer. They got an incredible property – and my clients walked away with $320K over asking! In this case, holding off was a definite win. But having an agent with good negotiating chops and a strong understanding of the market is a must-have in this kind of situation.

Are you looking to sell and get the most out of your investment? Contact me and we can talk about the best pricing strategy for your property.