As I touched on yesterday, one of the more common mistakes in the current real estate market is not pricing homes for sale at the right level. It's a tricky balance between achieving the price a vendor is after and finding the price the market is actually prepared to pay.
I have encountered vendors who refuse to consider shifting their asking price from a property valuation they'd been given prior to the global economic downturn, despite the fact buyers will be well aware that value has decreased significantly. An agent that is prepared to go along with this level of vendor stubbornness is not doing anyone involved any favours. Although price is currently a key factor in attracting buyers, how a property is pitched to the market is also changing with the economic climate. If you've been paying attention to property advertising over recent months, the shift in terms and words used has been subtly changing in line with market conditions.
For example, even a year ago using words like "bargain" or "value" rang alarm bells with many buyers and translated to "dump" or "bring your entire renovation team" in the minds of many. Just a few months later and in today's market, these types of descriptors are not only being used more frequently, but are being accepted on face value. Today, those people who are buying are not buying emotionally - they're buying in a calculated manner, the likes of which we haven't seen in years. Investors are looking for location, price and value before glory, glamour and designer kitchens.
In order to remain competitive in a market with a new mindset, many agents are experimenting with their advertising and words like luxury, lifestyle and designer have, for the most part, been replaced with descriptions such as value, comfort and investment – even the formerly taboo "reduced" is getting a more frequent run. I've also seen quite a lot of terms such as "best price in the building" in relation to apartments for sale, and across the board terms like "unbelievable value," "won't last," or even "X percent below market value," gaining momentum. Essentially, agents are trying to give buyers a reason to buy now rather than wait to see if prices continue to fall, which some are spruiking is what will happen.
In a nutshell, in the market we are in, sensitivity is definitely the watchword now in regards to selling luxury goods in general. Real estate is no exception.