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5 factors that will influence your selling price

The selling price of a property - as with any other commodity - is determined by demand. In a seller's market, there are more buyers than sellers, and property prices soar. We saw that a few years ago. In a buyer's market, as we are generally experiencing now, buyers are making decisions only after careful consideration. But in good times and bad times, there are factors which will influence the selling price of a property.

What are these factors which influence a buyer's decision to make an offer on a property?

Comparison

Very few buyers will buy the first house they see. Most buyers will look at a number of properties in a suburb, or neighbouring suburbs,  and they will compare these homes to each other. If a property is overpriced, it will help other similar properties in the area to sell for a better price - while sitting on the market for ages. For this reason, it is very important that a property's asking price is determined after thorough research of the prices similar properties in the same area have sold for in the preceding year, as well as the prices similar properties are being marketed for at that point in time. A good agent will be able to present you with a Comparative Market Analysis, which is a reliable aid when one has to decide about the correct marketing price.

Position

Rather buy the best home you can afford in a  good suburb than the best home in a less popular suburb. This advice you must have heard many times before. The proximity of schools, public transport, shops and churches may also lead a buyer to choose one suburb above another. Muslim buyers give preference to homes close to a mosque or a madressa, and is often willing to pay a premium for that.  If your property is situated on a busy road, or even close to one, many buyers will have a problem with the noise levels, and, unfortunately, that makes the buyer's pool smaller - with a negative effect on the selling price.

Perception

Of course, the "fact" that one neighbourhood is better than another can be based on perception. The  Oxford dictionary defines perception as an "intuitive recognition (of truth, aesthetic quality, etc)." What the buyer perceives, is not necessarily a fact, but it still influences his decision. For this reason, the selling prices of two similar homes on different sides of the same street, but  in neighbouring suburbs, may differ - the one suburb being perceived as better. Many buyers also perceive the proximity of an open area such as a park as a potential security risk - again not necessarily true, but still a factor that influences their decision.

Condition

Buyers will pay more for a smaller house which is in tip-top condition than a rambling, run-down house across the road. The importance of maintaining a property can not be emphasised enough. If the buyer sees a few cracked windows and peeling facia boards as he walks in,  it immediately makes him wary of other potential problems. Don't neglect maintenance until you want to sell - it is likely to be too costly to do all at once. If you attend to problems as they arise, you will benefit greatly when you sell in the future.

Accommodation

Obviously a home which offers a lot more accommodation will sell for more - if its position or condition does not negatively affect buyers' perception of its value. Most buyers looking for family home require  at least 3 reception rooms, 3 to 4 bedrooms, 2 bathrooms  (of which one must be main en suite), a kitchen and a covered entertainment area. Good staff accommodation also is in demand, as is  a double garage. Cottages and  home offices will have value only for a smaller group of buyers, and unless your buyer is in need of this, he is unlikely to pay more for the property because it has these "extras".  Keep this in mind when extending your property. That jacuzzi room or built-in bar will only increase your property's value if the buyer has those on his wish list.

A seller can not really do anything about his property's position or buyers' perception.  It is a given. It is also not recommended that costly alterations to improve the property be undertaken just before selling - you may not be able to recoup your investment. The seller, however, can make sure that the property is in tip-top condition when he sells, and he can set a realistic asking price with the help of a reputable agent to ensure the best selling price possible is achieved.  

 


Published in: December news

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