Pricing it Right

3rd Sept, 2015 Posted by Sohan

Selling plots of land and residential property in India is the easy step in the home-selling endeavor. The real problem is putting the correct price-tag on the house.
For tackling the problem of pricing it right, setting the bar too high might be a good option if the mansion to be sold is situated in a posh and affluent neighbourhood. Very few houses are available in such localities and the buyers will have very little to draw comparison with. If you have a helpful realtor, you can quote a price which is 5-10% higher than the regular price. Furthermore, a higher price will get higher initial quotes from prospective buyers. Negotiations will lead to a price in your favour.
Some people advocate the underpricing to attract to attract several prospective buyers; by reducing the price by 5-10%. This will catch the attention of several bidding wars and is a good solution if you’re looking for a quick close of the deal. However, quoting low is a monetary loss for the seller.
The real estate market heavily depends on market sentiments. The regulating force behind making purchase decisions is the first bite of information circulated about the property. Other decisions are taken around this central piece of information. This is known as anchoring.
An outlook is developed around anchoring. An over-priced home will lead the prospective buyer to focus on the positive features of the house. Potential customers tend to believe that the home-owner has something better to offer, hence the higher price. Though realtors believe in this principle, they advocate underpricing which results in closing the deal faster.
Knowing market conditions is important. Quoting a price lower than average will lead to a quicker deal as mentioned above if time is of extreme importance. Usually buying homes is dependent on demand and supply.  However it has been observed that winter months do not facilitate purchase. In India, people prefer to purchase homes closer to Spring – due to the reduction of repo-rate and lower rates of home-loan interest by the R.B.I (Reserved Bank of India). This motivates prospective buyers into buyers.
It is advisable to get a professional property evaluation done before fixing the price of your home. This will allow you to compare prices before taking a decision and help you achieve reasonable profits.