can someone explain...

L

Lisa1965

...the reasoning behind putting a price variance on a house advertised?

For example, advertising the house for $410000 to $450000

Are they saying they would take a minimum of 410???? I don't get why they'd put in a price range...if they're not prepared to take 410

Can someone shed some light on it for me?

Cheers

Lisa:D
 
they are putting it to the market to decide what it's worth - if 2 poeple want it they will get more thn $410k. if only 1 wants it they may get it for $410k. if no one wants it they get nothing
 
I just think it's odd they put a range in. If you wan't 450, then put 450 in...

but that's just me, fairly black n white in life!! :D

Cheers

Lisa:D
 
I believe it's to draw in people to see the place but more often than not they will not accept a price at the lower end, especially in the initial few weeks. It brings in all the people who think it's possible to buy it at a low price and if people are flocking through the door at an inspection, an agent has probably done a good job!
 
I saw oner a few weeks ago $199,900-$249,900. Now it's listed for $230,000.

The agents I've spoken to said they expect around the middle.
I agree- just say what you want.
Starr Partners have that stupid Property Launch with the price guide. Hate it.
 
Hate price guides and it appears I am not alone. If they won't accept the minimum listed then display a price which is likely to be within the ballpark. Feel the same way about catchy phrases like 'vendor says sell'. Surely they have a contract ready to go for all properties advertised or are they getting their listings from Google Street View, DH's.
 
Bargain Hunter said:
Hate price guides and it appears I am not alone. If they won't accept the minimum listed then display a price which is likely to be within the ballpark. Feel the same way about catchy phrases like 'vendor says sell'. Surely they have a contract ready to go for all properties advertised or are they getting their listings from Google Street View, DH's.
Click to expand...

Isn't that why it's on the market? :confused: Friggin' stupid REAs and their cliches.
 
Sigh...

you're all thinking about it way too much

you'renot suppposed to do that.

you're supposed to belulled into belvieing the thisvendor is more motivated to sell quickly so you will get a bargain

you guys just make it too hard for real estate agents






:D
 
When it first came out I thought how the hell does this work? Then I realised it was another wyy to get people in the door and then apply the pressure. Someone who can only afford to buy at the lowest listed price need not apply, someone who wants it at the lower price but has the additional funds might crack and shell out the extra.

I can only assune it works otherwise the REA's would move onto another marketing ploy.
 
If the buyer wanted $450k, you would need to advertise say $475k. As a marketing tool you will have far more enquiries for it advertised at $410k-$450k, compared to $475k. Whether they amount to anything is dependent on far more things than just the marketed price.

Funnily enough these are the exact prices marketing prices of a property I recently sold. I wanted $450k, which was a fare and reasonable price for the property. Having advertised it at $475k, would have scared off interest, because there has been no other unrenovated flats sold in that block or even comparable flats in the vicinity for a price that high.

There were a couple of potential buyers who put in offers of $405k and $410k early. As a seller, these people are just time wasters, because they obviously had no idea what the true market value was. However its just part of the dance that is negotiations for buying properties. And I wasn't desperate to sell.
 
buzzlightyear said:
As a marketing tool you will have far more enquiries for it advertised at $410k-$450k, compared to $475k. ... There were a couple of potential buyers who put in offers of $405k and $410k early. As a seller, these people are just time wasters, because they obviously had no idea what the true market value was.
Click to expand...
Doesn't this demonstrate that mentioning the lower figure of $410K just attracts more of the wrong type of buyers? :confused: What's the point of attracting buyers who aren't prepared to buy even close to what you want? If $410K is such a ridiculous offer, aren't vendors who mention $410K in the price range just time-wasting vendors? ;)

I don't understand this method, either, but I agree with Bargain Hunter that they wouldn't do it unless it was getting them results. (Though how the real estate industry determines whether it gets "optimal" results would be interesting to find out.)
 
Perp said:
Doesn't this demonstrate that mentioning the lower figure of $410K just attracts more of the wrong type of buyers? :confused: What's the point of attracting buyers who aren't prepared to buy even close to what you want? If $410K is such a ridiculous offer, aren't vendors who mention $410K in the price range just time-wasting vendors? ;)

I don't understand this method, either, but I agree with Bargain Hunter that they wouldn't do it unless it was getting them results. (Though how the real estate industry determines whether it gets "optimal" results would be interesting to find out.)
Click to expand...

In the scenario and the two people and their offers, yes you are correct. They were the wrong buyers. One person already owned a couple in the same block and in my opinion was just making a speculative offer. But in other scenarios you may have a buyer who is looking at a lower end figure in that range, but likes the property, has an emotional connection to the property and can be talked up by the REA.

Time wasting vendors, different side to the same coin :D Like that one. Again, an agreement will be made between one buyer and one seller. There are bound to be be prospective buyers who don't agree with the price tag, marketing or host of other things about the property itself. As a seller, I only need one to agree with me. The rest is background noise.
 
buzzlightyear said:
But in other scenarios you may have a buyer who is looking at a lower end figure in that range, but likes the property, has an emotional connection to the property and can be talked up by the REA.
Click to expand...
Yes, that's the scenario I was assuming this strategy is intended for.
buzzlightyear said:
Time wasting vendors, different side to the same coin :D Like that one.
Click to expand...
Thought you might. ;) Good luck selling. :)
 
This must not be a particularly effective strategy as it generally looks like only one agent in an area uses it and they dress it up by calling it something like Express Sale method.

I'm sure psycholgically the Vendor wants the higher amount, the Purchaser thinks well they'll sell for the lower. I bought a house a couple of years ago advertised 245-265, for 237 which was valued by oue lender's valuer at 240.

Offer what you think it's worth from your research
 
Way back when, we bought our first PPoR via this method.

We didn't know it at the time, but the Seller's had bought the house 4 years prior, in immaculate condition, for 108K. No such thing as rpdata back then.

They'd subsequently got angry with one another and started to let the place go. In the throws of divorce - pop the house on the market.

Selling price range, offers accepted between 85 K and 115 K. We thought - wow - big gap !!

Left it a couple of months to soften the Vendors up with time. Fortunately they received no offers.

We came along and offered 79K. Offer was 20% below lower asking range.

Dummy spit from Vendors. Officially no reply.

Left it for 2 weeks.

Popped in another offer for 87K. Offer was 6% of the way between lower and upper asking price.

Dummy spit from Vendors. Officially a reply this time.....

Vendor countered with 105K. Long way apart.

Left it for another 3 weeks.

Vendor's agent called us, asking if we wanted to put another offer in.

We said no.

Left it for another 2 weeks.

Vendor's agent called again, Vendor ready to sell this time.

Popped in an offer for 96K. Vendor accepted.

Selling price was 36% of the way between lower and upper asking price.

They got divorced - we got a bargain.
 
The idea behind marketing a price range between two prices is to drag people up a notch to inquire/look at the property they would not normally entertain because its a fixed price above their comfort zones. So the vendors lower the starting price to capture this market even though they are not willing to accept an offer at this level. Its purely a marketing ploy to get more people through doors because sales people know it's a number games. They are looking to get people to fall in love with it because emotion is what motivates people to pay more.
 
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