Pricing a home when the market will not sit still

A price is not a guess about what a house is worth. It is a strategy about how a house will be sold. Those are different things, and confusing them is how good homes end up sitting for ninety days with two price cuts and a stale listing.

Comps are a starting point, not an answer

Comparable sales tell you what buyers agreed to pay for something similar, in the past, under conditions that may no longer exist. We use them to draw a range, not a number. Inside that range, the decision depends on three things the comps cannot see: the current buyer pool for this specific house, the rate environment this month, and how much patience the seller actually has.

The first ten days decide everything

Every serious buyer for your price band will see your listing within ten days of it going live. If the number is right, they show up. If it is high, they wait, and the house begins to carry the faint smell of a problem. Reducing the price later rarely recovers the energy of the launch. This is why we would rather list slightly under a hopeful number and let competition find the ceiling.

When under-pricing is wrong

Unique properties, small buyer pools, and anything over four million. In those cases there may only be a handful of buyers in the country, and a low number does not create competition, it just creates a discount. Those homes are priced on story, and marketed one conversation at a time.

What a rate move does to your buyer

• A half-point rate increase cuts roughly five percent from what a financed buyer can afford.
• Cash buyers do not care about rates, but they care very much about what everyone else can afford.
• Rate drops bring buyers off the fence quickly, often within two weeks.

We watch the ten-year Treasury more closely than the Fed, because that is what mortgage rates actually follow. When it moves, our pricing conversations move with it, sometimes the same afternoon.

The right price is the one that makes the best buyer afraid of losing the house.

The conversation we have with every seller

We show the range, we explain the strategy, and we ask one question: would you rather have the highest possible number in the listing, or the highest possible number in the contract? Everyone says the second. Not everyone means it. The ones who do tend to close in under three weeks.