The historically low interest rate combined with subdued demand has brought about the ideal buying market conditions.
Going to market at the right price is important at any time, but more so during a buyer's market. You can check the value of your home by looking at what other similar homes in your suburb, street or complex have recently sold for and downloading a valuation report.
This is according to Tony Ketcher, managing director of Seeff Randburg, who says while there is an increased willingness to buy, buyers are aware of price and market value.
Despite pockets of excellence in terms of demand, sellers are facing fierce competition. Right pricing from the outset is vital for those who hope to conclude a successful sale. Listing your home at an unrealistic price will see the property sit on the market for an inordinate period of time and you may end up having to cut your price if you need to sell, something that sends the wrong message to buyers.
Unfortunately, uninformed sellers are often swayed by low commission offers and the promise of a high sales price. Despite the fact that there is healthy demand, especially in the sub R2 million price band, Seeff agents are continuously called by desperate sellers whose properties have been sitting on the market without success. Ketcher says this highlights the role of a credible real estate agent that has a strong track record, is active in the market and who knows what is in demand and how much buyers are prepared to pay.
Only an experienced and skilled agent that knows the area and has operated there for some time can really provide guidance on pricing. Such agents will have vital insight into the performance of the market and what is selling and for how much, as well as knowledge of the properties in the area. They have often re-sold some of the homes and know that price is not only about plot size and bricks and mortar, but that design, features, modernity and more come into play, says Ketcher.
Property sells at a price that a buyer is willing to pay and a seller is willing to accept. If a house is priced under market value or lower than similar properties on the market, it is likely to attract multiple offers that will drive the price up to market value, he says. There is then little danger that your home will be priced too low.
It is also not beneficial of a credible real estate agent to try and sell your home cheaply as they have their reputation to consider. Rather, the danger lies in overpricing. For example, if you want R1 million for your home, but there are 10 similar properties on the market priced at around R900 000, then the odds are really stacked against you and yours is a one in 11 chance of success.
Listing your home at the wrong price may also put you at a disadvantage when it comes to web searches for example. Say, you list your property at R1.1 million, but hope to get offers around the R900 000 mark, then yours is unlikely to catch the eye of potential buyers if they search for properties priced below R1 million, Ketcher says.
Going to market at the right price is important at any time, but more so during a buyer's market, he adds. The internet and access to information means that buyers know about market conditions and prices and do their homework. It is better to give an agent leeway to negotiate as the seller is likely to see more success. More often than not, the first offer is always the best offer.
Seeff has a home on the market where the seller wants R2.1 million and has turned down two offers at R1.8 million and R1.9 million respectively. This, despite the fact that the home has attracted 279 potential buyers on show days with no higher offers. Here, the market is telling us that the real market value lies somewhere between the R1.8 and R1.9 million mark.
Ketcher says that the reverse is also true for buyers; always ensure that you pay fair market value and guard against paying too high a price unless you intend holding onto your home for a good couple of years.
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