Pricing Too High And Expecting Low Offer Not Best Strategy To Selling

By Katy Gurley

This two-bedroom, 700 square-foot home on Maple Street in Sag Harbor is priced at $399,000, and is available through Prudential Douglas Elliman. All images courtesy of brokers

Southampton - Sellers in this uncertain housing market who are pricing their houses to sell at or close to the asking price are employing the best strategy, local real estate brokers said this week. Brokers said pricing a house too high, expecting lower offers, is not the best strategy in this market of tumbling prices.

"The goal is to get the best possible price with the best possible terms as quickly as possible," said Shaunagh M. Byrne, senior vice president for the Corcoran Group.

Priscilla Garston, sales associate for Prudential Douglas Elliman.

"Generally sellers have adjusted and are pricing according to the market, though we are seeing people coming down on price. Nowadays people are pricing properties right the first time, though it's been a long arduous learning process for many sellers," said Byrne, who is based in Bridgehampton.

James MacMillan, associate broker for the Amagansett office of Brown Harris Stevens of the Hamptons agreed that sellers should price their homes close to what they believe will be the selling price.

"In this market, my advice has always been to price the house at what the market dictates or not much above what one would like to achieve," he said. "This way, customers will recognize a good value and the house will get much more exposure. Many times this results in several interested parties and offers above the listing price. There are still many owners who feel they need to price it high in order to negotiate with bargain hunters. This theory may push the house out of the price range of its competition and often prevents customers from making any offer at all. Better to price it right and be less flexible."

In pricing a home, it's always important to look at what brokers call "comps" or comparable sales in a particular neighborhood in about a six-month period. You look for what has sold at what price, and what is on the market currently that compares to your property in terms of price range, amenities and condition of the property, brokers said.

At $1, 495,000, this five-bedroom, 3,000 square-foot house on Porter Road in Southampton is priced to sell, according to Shaunagh M. Byrne, senior vice president for the Corcoran Group.

Patrick Galway, managing director for the Westhampton Beach office of Town and Country Real Estate, suggested that sellers invest $400 to $500 in a professional real estate appraisal. "In the scheme of things, it's not that big of an expense and it gives you a realistic picture of what your house is worth."

Galway, too, agrees that pricing your property at what you want to get for it is important in this market. "We're seeing deals made now at 10 percent off the asking price," he said.

Selling strategies have changed drastically since the heyday of the real estate market when people put extraordinarily high prices on their properties and sold them in a matter of days. Then, when the market weakened, buyers expected big discounts. Now, buyers are starting to see that houses are priced more realistically, brokers said.

"When the market first got very weak, last October, buyers wanted a big discount off the asking price," said Priscilla Garston, sales associate for Prudential Douglas Elliman. "If the price was a million dollars, they wanted it for $500,000, she said, noting that prices are down 30 percent from 2006 and 2007. But sellers now who are pricing their houses right are selling them. I believe the market has found its level buyers who know what a property is worth. They aren't asking for a big discount because houses are priced better."

If you price a house too low, chances are you'll get multiple offers and touch off a bidding war.

"Don't worry about pricing [the property] too low because homes priced below market value often will receive multiple offers, which will then drive up the price to market. Pricing is all about supply and demand. It's part art and part science, and no two agents price property the same way," according to an article on the website www.about.com.

Local brokers said that if a buyer doesn't get an offer in 30 days, it's time for a price reduction. "You don't want something to languish on the market," said Byrne.