Here’s another quick and painless listing tip to avoid unwanted scrutiny when selling your home. And it’s an easy one to follow.
In short, don’t list for less than you paid for it. That’s right. Just list the property for more than what you originally bought it for.
For example, if you purchased a home for $350,000, don’t list it for $349,000. Or any other amount below $350,000. It’s as simple as that.
This is especially true if you only recently purchased the property.
There’s a Stigma Attached to Cheap(er) Homes
Nowadays, everyone can easily see what you paid for the property you’re trying to sell. All they have to do is scroll down to the bottom of the listing page on Redfin or Zillow and voila!
If you’re like me, you’ll always scratch your head if you see that the listing price is below what the owner paid.
“Why are they taking a loss?” you might say. “What’s wrong with the property?” is another common reaction. Did someone X there?
Put simply, it just makes people think something’s wrong with the house, even if it’s just a run-of-the-mill loss and nothing more.
I understand the recent downturn led to a lot of short sales and foreclosures, and that’s a special event. We can exclude those from this rule.
But if you purchased a home a year ago and are now listing for less, someone (a prospective buyer) is going to be asking a lot of questions.
Conversely, if you list it just a little over what you paid, you can avoid this potential scrutiny altogether.
No one will care that you’re only “making” a little bit of money on the sale. But they will care if you’re losing money.
I used quotes there because in reality, unless you’re listing for a healthy premium, you’re probably going to lose money on your sale thanks to the costs involved with selling a home.
But buyers don’t care about that exact math, just the fact that the home is going for less than it previously did.
Find a Reason to List a Little Bit Higher
Now you can’t just arbitrarily list a home for more than the market allows. But if you find a reason to, it’s perfectly welcome.
If you find yourself in a tough spot where you have to sell for less than what you paid, figure out a way to spruce up the place so you can command a slightly higher asking price.
This might involve something as simple as home staging, or perhaps just a solid cleaning and some added curb appeal like new grass, plants, paint, etc.
You don’t need to go nuts pouring money into a losing endeavor, but it might be a good return on investment if you sprinkle in a little cash and/or elbow grease.
Just be mindful of pricing thresholds when you do. I’ve mentioned before my disdain for listing above a key price threshold, such as $300,000 or $450,000.
Ideally, you can list above what you paid while still keeping the price below those psychological levels, making everyone happy.
For example, if you originally paid $540,000, and were planning to list below that, maybe you can eke out a $549,000 price tag and stay below the buyer filters at $550,000, while still satisfying the above what you paid criterion.