You have probably seen listings for sale with a price range rather than one fixed price. Wondering what that is all about? Here is what you need to know.
California real estate agents were the first to introduce a concept called ‘value range pricing’, also known as variable pricing or range pricing. Instead of one listing price, the seller can list a pricing range and deepen the pool of buyers who may be interested in the home.
The advantages are many. Some sellers are more comfortable using a price range for their home, rather than a specific price that feels too high or too low. The seller’s home appears in a broader number of results when a real estate professional or a buyer searches for homes online. Homebuyers shop in a range because they want to see the best homes available that they can possibly afford.
Getting as many buyers as possible to look at the home is crucial for sellers. If a buyer’s search parameters are limited to between $300,000 and $330,000, they won’t see the home that’s listed for $335,000. The value range selected by the seller may be $325,000 to $350,000, which would put the home in front of the $330,000 buyer.
There are some drawbacks to value-range pricing. It can impact comparisons, because MLSs that employ it tend to use the upper end of the price to create reports, which can skew the results upward. These reports are passed to consumers, who may not understand what value-range pricing is.
Furthermore, I am not always a fan of value range pricing because it can indicate up front how long the seller is willing to go with the sales price of the home. As such it might affect your ability to negotiate.
As always, there is a time and place for these types of home sales strategies, and in your case it may be helpful or it may hurt your ability to negotiate… If you’re a seller, give us a call and find out if value range pricing is right for you!
About Jaleesa Peluso, Laguna Beach Realtor & Certified International Property Specialist
Jaleesa and her team specialize in representing local as well as foreign buyers and sellers of Orange County real estate. Are you considering leasing, buying or selling your Orange County home? Call us now at (949)395-0960!