Setting a price 'range'

Some real-estate sellers are trying to drive traffic and spur bids by listing homes in a price range. Here's an example of a home that closed in mid-November in Duluth, Minn., using a range-based pricing system. Price range: $109,999-$129,876 Buyer's 1st bid: $109,999 Seller's 1st counter:$128,000 Buyer's 2nd bid: $115,000 Final sales price: $125,000 Sources: USA TODAY research; Prudential Truscott Realtors, Duluth, Minn.

As the Internet became integrated into the real estate process, properties-for-sale moved from phone book sized collections, updated bi-weekly, to an easily accessible online database called the Multiple Listing Service (MLS). Several years later, the general public was given access and consumers had more power to search and research property. Then and now, consumers and professionals will use price as a basis for their search. For example: A value range property that is priced between $500,000-$550,000 will show up in a search of a buyer who searches between $475,000-$520,000. If a the seller prices their home at a fixed price at $535,000, the property would not come up in the buyers search. As more buyers view and preview the value range properties, the added attention will generate more exposure to that property in comparison to comparable fixed priced listings.

Supporters of the technique say that the additional exposure has the potential to generate more offers, allowing more room to negotiate, which will ultimately lead a higher market price. Since competing buyers legally cannot know the price of competing offers, the presence of an offer, even a low one, may act as the catalyst in achieving a price above the prevailing rate. The Seller benefits by generating offers he may not have received due to the limitations of fixed pricing.

by The Lund Team from North San Diego Real Estate Online

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