99 is marketing’s most profound invention. The psychological effect of paying 99 cents instead of a dollar is undeniable: check out these stats. Perhaps because we read left-to-right, consumers significantly choose products that cost $4.99 versus $5.00.
There's even studies about how increasing the price from say, $34 to $39 increases demand by one-third!
In the last 365 days, homes priced at $694,000-$699,999 have sold 9 days quicker.
At $594,000-$599,999 have sold 7 days quicker.
That's right, homes priced correctly sell better.
Here’s the issue: You cut your audience in half. You don’t show up in search results. It’s as simple as that. If you’re about to sell your home at $499,999, stop now and fire your agent. Buyers too: if your agent searches for homes from $500,000-$550,000, fire them. They need to be going in at $494,000.
How bad is this? Around 90% of homes are listed in that range. Read that again: 90%!
If you're reading this, please share it. Yes, I do want more publicity. But this is a serious issue about malpractice. Sellers who have made mortgage payments for decades lose out on their equity. All of it - wasted by a silly marketing ploy. They simply don’t get their full money back. The exposure to all the buyers out there is half of what it could be.
Homebuyers, you need to watch out too. An old client of mine wanted to buy a house in Granada Hills. She had a Realtor before, but couldn't find any good houses. As soon as she hired me, I punched in $594,000-$650,000 and found her dream home. We submitted an offer and got it accepted. Keep in mind, a probable reason this dream home had no other offers is because it was priced at $595,000.
My buyer got a deal.
Your two new magic numbers are 44 and 94.
How about on the apps?
Zillow is the best, but barely. You can move in $10,000 increments up to $500,000. After that, it moves in $25,000 increments. The Realtor.com app always moves in $25,000 increments.
Redfin and Trulia are the worst. They move in $50,000 increments. So if you want to see the whole picture, you’ll have to deal with seeing just too many homes. Want to see all those homes priced at $499,900? Have fun seeing all the homes priced from $450,000 to $500,000.
Get the point? Consumers - you’re all screwed. Any of the big 4 apps available to you are broken. This is the tragedy of the real estate industry. As Realtors, we deserve shame for cheating our clients (well, not me!).
Here is a visual representation of that:
So What Do You Do?
You know what I’m going to say. Use a Realtor. The MLS (where we search for homes), allows us to type in our prices. Just remember - make sure your Realtor knows how to search.
Buying a home just got harder. Selling? Well, you know what to do now.
For more information on how these statistics were arrived to, or if you're interested in buying/selling, please call 818-390-3265.