Overview. Long gone are the days when buyers were poking around in the dark, with or without the help of their similarly blinded real estate agent, wondering if the asking price on that home they were interested in was reflective of the market price. Sellers and their real estate agents held all the cards. Times have changed and that is no longer the case.
With sales price details and metrics like “time on the market” a few keystrokes away buyers and their agents are more educated than ever. We know that, and we make sure our selling clients know it too. Underestimating the intelligence of today’s buyer will only lead to missed opportunities and disappointing outcomes.
We recently sold a grand historic townhouse in fabled Brooklyn Heights, New York for a record price. We were selected by the seller for our effective pricing strategies — price it right and buyers will bid. The outcome of our comprehensive marketing and sales efforts far exceeded their expectations. This is how we did it:
Step One. Property assessment. First, we inspect the property in order to see how the value proposition can be maximized. This 19th century beauty, a corner property at 25 feet wide and 4,800 sq. ft., was being used as a multi-family but could be converted back to a single-family. Buyers understand that such assets are valuable, and will be above the market for completely rehabilitated homes once they have completed their custom renovations. We consider all of this when suggesting an asking price to our client.
Step Two. Market assessment and pricing guidance. We carried out an assessment of the market by analyzing similar homes sales. We do so by creating our own proprietary comparable market analysis (CMA). The CMA is a detailed summary of closed sales, listings in contract and listings on the market. We then use this assessment for pricing guidance. As wider buildings trade for a premium over narrower ones and corner properties trade for a premium over ones that are not this property was placed at the high end of the indicated price range. As the property was in need of a full gut rehabilitation our view on an appropriate asking price was at a discount to what a fully rehabilitated property may have fetched recently in the open market.
Step Three. Smart, strategic pricing. Believe it or not there is a fine line between pricing a property correctly and pricing it too high. Ask too much and nobody will show up. When no one shows up then the price will need to be reduced. While not the end of the world this can sometimes become a slippery slope. Price a property correctly and many interested parties will show up. The best circumstance a seller can ask for is for more than one bidder to be interested in your property. Once that happens you have leverage, which is all you usually need to maximize your sale price. In this case we provided the seller with a suggested asking price range. They choose an asking price near the top of the range.
Step Four. Wide market exposure. As per our recommendation the property was brought to market in early spring (the peak selling season in New York City is during the months of March, April, May and June, especially for larger properties) at a price that would generate substantial interest. Our highly polished and professional marketing material, along with our extensive network, helped us draw many interested buyers to the property. We took qualified buyers on in-depth tours of the property and talked them through the possible upgrades and reconfiguration options.
“The Brennan team is amazing. They met and exceeded our every expectation. I can’t say enough about the advantages of going with this boutique firm over one of the bigger ones. There is such a difference when you feel like the #1 priority. Every question is answered in minutes, not days, and every concern was treated with respect, patience and understanding. In such a difficult market, I never imagined we’d be in contract in less than a month, but we had multiple offers over asking price. From the smallest studio to the biggest house, I would recommend Brennan to anyone and everyone.”
– A. Page