It’s no secret that the prime marketing time for selling a home occurs during the first few weeks of it’s listing. Don’t just take my word for it. "Your home should be priced right from the very beginning," according to Jonathan Miller, President and co-founder of Miller Samuel Real Estate Appraisals and Consultants and author of Matrix, his blog which is "an attempt to cull together items of interest or relevance in the real estate economy." He has been compiling data on the Manhattan Real Estate market for over 20 years and the creator of the Manhattan Market Report. We asked Mr. Miller some questions about his perceptions, based on hard data, of pricing and how it affects a seller’s bottom line.
TG: Is it a misconception by sellers that listing their home at a value higher than market is a good marketing technique?
Miller: Actually, we find the strategy of listing "high" to be detrimental to the price achieved for the property. It is better to price properties closer to their current values. We define an over priced listing as a price that is more than 5% above market value.
TG: Can longevity on the market create both a stigma for the property and the Sellers?
Miller: Yes, the impression the property makes to the brokerage community is that the seller is either difficult to work with or has unrealistic expectations of value. The average days on market – defined as the number of days between the last price change (if any) to contract date – is 120-150 in a balanced market with no price appreciation.
TG: So, in your opinion, based on your knowledge of data specific to Manhattan and your expertise on trends, could we say that Sellers will see their homes sell for a lower and more significant price difference if pricing isn’t accurate?
Miller: Correct. On a simple clerical level, properties that are over priced, do not come up in a brokers listing search for their prospective buyers.
TG: Is it true that although Manhattan homes may sell faster in this market, that margins can still be affected by poor pricing strategy?
Miller: Correct. It has been our experience that properties in Manhattan, priced out of sync with their value, will usually sell for less than their potential.
Further evidence that proper pricing proves a priority in procuring a purchaser at peak price. If you don’t believe me, ask Peter Piper!