Pat Kennedy - Your Washington, DC Real Estate Connection

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An Interesting Numbers Game

 In this market, our biggest challenge seems to be pricing our listings right on the bulls eye.  But how to do that is sometimes pretty tricky. 

Today's Washington Post carried an article about an interesting approach to pricing, so looking for any help I can get, I read every word of it.

Writer, Sandy Fleishman, cited a study by Cornell University showing that houses with prices ending in "000" tend to sell for less than homes with a more precise number.  If, for example, you set your number at $649,000, your home could be expected to sell for less that a number like $648,723.   

Then there was a second study that Redfin did looking at 3,000 sales in Seattle.  They concluded that a price ending in "500" was the best for pumping up the bottom line.  So by lowering the asking price to $648,500, your bottom line would actually be higher. 

Hmmmm.

Both studies looked at the psychology of number from the point of view of sellers trying to maximize their net proceeds.

I had to wonder what is would look like for buyers placing offers.  Would a seller be more likely to accept something at $625,142 without countering?  Or would $624,500 be a better strategy?

But what about all of the other factors - property condition, accessibility for showing, staging and location? 

While I did find the article a fun read, I thought the studies just might be a lot of hooey! 

Comment balloon 13 commentsPatricia Kennedy • February 16 2008 12:15PM
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