Whether your price is right depends on other sellers

THE REAL ESTATE WONK

December 14, 2007|By JAMIE SMITH HOPKINS

One of the many challenges in a housing slump: How do you figure out what's a fair price when the market keeps changing?

Pat Hiban of the Pat Hiban Real Estate Group (with Keller Williams Select Realtors in Ellicott City, and try getting all that out in one breath) says his recommendation to sellers is - first off - to decide "whether you are a have-to seller or a want-to seller." That's not for pricing purposes, by the way: That is to suggest to the want-to folks that maybe they really don't want to sell.

For the have-to's - or the especially determined want-to's - Hiban says his strategy is straightforward.

"You want to price it less than the active competition," he said. "Forget about comparables - we're not even using comparables anymore because comparables are the past."

("Comparables," for those of you scratching your heads, refers to comparable sales in recent months.)

"That's how you sell," Hiban said. "The people that get it are the ones that are successful. The people that don't get it are the ones that sit on the market."

It does not matter what situation the sellers (your competition) are in. He frequently hears from prospective sellers that they think their house is worth $50,000 more than an identical one down the street "because they're desperate, and I'm not."

"You might as well say they're realistic," Hiban said. "You're still competing."

He suggests looking at the three most competitive active listings you will be going up against. If there are no real differences between your house and theirs, undercut them on price, he said. If you have got something they do not - say, a finished basement - then go with the same price.

Find Jamie's blog at baltimore sun.com/realestatewonk.

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