Quote:
Originally Posted by Bonka
Actually, given the market right now in East Vancouver the difference between underpricing it and pricing it at fair market value is not as great as one would think in terms of net dollars to the seller. The premise of underpricing is done to generate condition-free offers so it sells firm immediately and the potential of selling "x" amount over asking is a consequence of going this route. Whether or not it sells above fair market value is at the mercy of the buyer. This is common in scenarios where excess length of time on the market is undesirable for the seller (estate sale, relocation) but to assume that underpricing every single home will always benefit the seller is erroneous there's actually just as much risk as there is upside.
With what glossed over information we have about this home perhaps this is the best course of action strictly from the seller's point of view.
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Obviously there are risks when pricing your property below the market but it all depends on the market. Given how people are conditioned in this city to love their houses when all valuation metrics can be thrown out the window I think it'll work. The risk to the upside outweighs the downside. Why do you think grocery store have weekly lost leader? Because you won't just that one item but probably do your whole week of shopping there. I'm merely pointing out the emotional side of things when it comes to property buying. People see low prices and immediately get excited. When your thinking comes from your gut instead of your brain you know you gonna be in a world of hurt down the line.