The Nuclear Option, Quick, Painless and Profitable

The nuclear option. The mere mention of it can make a homeowner duck and cover. It can be a hard concept to sell because it is not what would be considered “standard issue”. What I am referring to is the pricing strategy you choose when it comes time to sell your home. This may not be for everyone but if you are more contrarian than conventional, prefer to stand out as opposed to blend in, then this may be for you.

The Nuclear Option - Sell Quick and For More Money

For this example we will use a house with a market value of $500,000. Traditional theorists believe the more the house is listed for, the more it sells for. So seller “A” decides to sell his house for $550,000 and adopts the philosophy that he can always come down, but once we do we can’t go back up. Two streets over seller “B” decides to pursue the less conventional approach and elects to establish $450,000 as the price she will choose.

So the $64,000 question becomes, or in this case the $50,000 question is, which homeowner will sell their home the quickest and for the most money?

Getting a home seller to push the red button (sign the listing agreement) usually includes a summary of the benefits it will produce:

1. Awareness – a home priced below market value is going to create a lot of visibility
2. Traffic – increased visibility leads to more traffic. The more people that look at your home, the more likely a buyer will emerge. Real estate is a numbers game. It helps when the odds are in your favor.
3. Market Pricing – the first 30 days are critical when selling your home. Think of the grocery produce section, with a longer shelf life. It’s fresh, it’s new and will never look better than it does for the first few weeks. After that people will disregard it and wonder why it did not sell.
4. More than One Offer – making a multiple counter offer to more than one buyer changes the whole dynamic of the transaction and puts you in control. You want to sell from a position of strength, not of weakness.
5. Select Your Buyer -the laws of nature state the strong survive. It’s no different here. The elimination of some buyer contingencies, more deposit, better credit. All characteristics of a buyer you want to do business with.

Compare this to the consequences of listing too high and chasing the market. I don’t think most people would disagree with the stigma of an overpriced listing and the liabilities associated with it such as:

1. Buyer motives – are they serious about closing escrow or are they in escrow with you because nobody else would accept their offer?
2. Desperate seller – if the property has been on the market for an extended period, the thought is the sellers will accept anything just to get it under contract
3. Property issues – what is wrong with the property? Structural, plumbing, foundation. These questions circulate among potential buyers when the property sits unsold.
4. Seller concessions – be prepared for an aggressive list of demands from a buyer once you are on the hook, because you cannot afford to lose this contract and put the house back on the market.

Strength or weakness, chose or be chosen, move on or stay. It’s great to have choices!