Real Estate Article: Pricing Your Property
10/30/2002

Under the supply and demand of the current market, real estate sales had maintained a steady growth. Even though the market value of houses did not decrease, but the price for your house is not rising significantly like a year ago. Under such circumstances, the sellers should be extra cautious when pricing their properties. 

During the three years before last June, all had watched the real estate market coming up. Houses, the value of town houses around the Chino Hills, Diamond Bar, and Rowland Heights area went up so fast that only a certain percentage of buyers can barely catch up. 
Last summer finally the frenzy had come to a stop. The market has stabilized to a steady, quiet growth due to the fact that price rose so much causing buyers’ ability to buy at such high prices to drop. 

At times like this, sellers should price their property accordingly. However, there are some sellers who are caught in the past “seller’s market.” Those who overpriced their houses had missed the chances to sell their houses. 
Last August, I gave an estimate of $540,000 to a seller. The seller insisted that his house was worth at least $570,000. Finally he found another agent to list his property at $569,000. A month and half passed and no one made an offer. In October the seller lowered the price to $550,000 and till today, the house is still not sold. 

In fact, this house’s estimate value is probably $530,000 now. It’s been on the market for too long. To begin with, only a small percentage of buyers can afford a house of this price. Plus too much exposure and overpricing, this house sadly became “old news,” and “bad model home.” 
This story tells us that when you decide what your selling price is, be very realistic. No agent wants to take his or her clients to preview an overpriced property. If your agent can figure out your property’s market value, then any other agent can do it as easily. Consider your selling price cautiously. Your selling price should be within the current market value, or your asking price will always be an unrealistic dream. 
It’s easy to understand this theory. However, to ask a seller to price their property reasonably is always a hard task. Everybody wants to sell his or her property at the highest price possible. Therefore the sellers always will want to overprice their house a least a bit. Some agents will agree with the sellers to get the listing authority. At the end, it only harms the sellers when the property stalls on the market and the sellers have to lower the price. 
So, how should you set your selling price? 

I would suggest that a seller set the selling price according to the market value. This way, you will attract more buyers to preview your house and make more offers. When there is competition, you can choose the best, highest offer there is. If you really want to leave some room for bargaining, try to set your asking price no higher than 2% of the market value. 

The market is still pretty stable in the East region. Diamond Bar is still going strong. Three room single family houses and townhouses in these areas is going up at a slow, steady rate, as compared to the more than four room mansions which had decreased a little in the current real estate market. Chino Hills’ overall real estate transactions dropped a little from last year. The average value of single houses with three rooms or smaller stayed relatively the same as last June. Single houses with four rooms or bigger significantly dropped to about $370,000. 
Many people are baffled by the recent dramatic ups and downs—at times like this many debate if they should sell or buy their properties. Some worry that the market will crash and go down to a new low, so they throw their houses on the market. Or some speculate that the value of houses will go down, so they refrain themselves from buying their dream home. 

I would suggest to all that since no one can predict the future, why not just stop all the guessing and worrying and live your life as you normally would. If at this stage of your life you are ready to buy a house, then buy it. If you want to sell your house and move to another one, then do it. If there is an inevitable storm coming our way, then, let’s all enjoy the peaceful night before the storm.

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