In Episode 8 of the Toe-2-Toe Podcast, hosts Jenn Murtland and Monica Weakley duke it out over whether realtors should price their listings at a flat, even number. Learn Jenn’s ideas about the psychology behind pricing with nines and hear why Monica insists on using a flat, even number. This episode will help you rethink your pricing strategy for your next listing.
- When talking about pricing strategies, do you go with the 299,900 or do you go with the 300,000 even? Is the hundred dollar difference important?
- Monica believes firmly in using the flat number.
- What we know when we study search engines is that most of them have searches that start and stop on even numbers.
- When you price your house on that number, on 400 even, you're actually doubling your exposure for the house.
- Monica will price it where scientifically, and digitally, it makes the most sense to get the most eyes on it.
- At 399,900 buyers will miss the house in search results and it could have been perfect for them.
- Jenn argues that McDonald’s sells everything on the 99 mark. There must be something there.
- She’s sure there’s science around people thinking they’re getting a deal at the 99 mark.
- Jenn argues that she’s priced at a flat number before and that when they reduced it to the 9, they received higher traffic. But she’s also seen it go the other way.
- If you’ve got the house priced inaccurately, it doesn’t matter.
- Buyer’s perceived value is price + condition.
- If within 10-12 showings you haven’t received an offer, you’ve probably priced it too high.
- It’s more about actually getting the price right.
- Jenn says that in their market, if you price a house right you'll get around 95-97% of the asking price. If priced wrong you'll only get 88%.
- Jenn and Monica roleplay a pricing discussion with a seller who wants to overprice their home.
- Jenn would tell them that she's aware that they're saying you can always come down and it's more difficult to come up.
- Monica says she tells them she wants to bring them something to say no to.
- Jenn would rather say no to an offer than not have anyone to work with.
- Price the home where the buyer will see it as a great value.
- Jenn would explain how the seller can get more money for their home if it is priced accurately.
- Monica identifies that agents don't have the confidence to have these conversations with their clients.
- It's fear that keeps you from being honest. That's not fair to your clients.
- When it’s not right, just walk away.
- In the survey Jenn and Monica conducted, 85% of realtors said they choose flat numbers for home prices.
- Monica reiterates the importance of getting people to see the listing in search results.
- Jenn still feels people have a psychological response to the 99 mark.
3 Key Points:
- Pricing your client’s home on a flat number increases its likelihood to show up in online search results.
- Pricing with nines may have a psychological effect.
- The most important thing in pricing strategy is to price the home accurately.