How should we price our house?
We're putting our house on the market this weekend. The appraiser came back with an expected sales price of about $500K. Lots of caveats in his assessment: our house is 4400 sf on 3.5 acres and a lake, no direct comps in the neighborhood (2 subdivisions) with all 3 of those characteristics, so he used 2 comps with acreage/lakes in similar neighborhoods in a different zip code to the north, more remote from city services, and one in the neighborhood on a small suburban plot. All 3 are 10-12 years old, so are presumably in early stages of datedness, ours is 18 years old with 0-5 year old finishes.
So we need some help with the psychology of pricing strategy. We will price it somewhere between $500-550K. I'm expecting that some of you will jump in with the oft-given, automatic advice of "price it 10% below the comps so it'll sell quickly" but I'd ask that you consider all the rest of the info on the market, potential buyers, and competitive listings before responding.
Buyers: This price is the top 10% of the market around here, so likely buyers are doctors and executives, highly likely relocating here.
Market: Stable, with supply and demand pretty evenly matched, according to the appraiser. Things have begun to move, based on anecdotes of a half dozen friends and acquaintances that have listed/sold homes in the past year.
Only 5 competitive listings in our zip code between $500-550K (there used to be a few more; I need to check and see if any have sold or just pulled off the market).
A. $548K: 4200 sf, 2006 build, comparable finishes, small lot
B. $539K: 4000 sf + basement, 1986 build, a few minor updates (not kitchen or bath), 2.7 acres
C. $525K: 4400 sf, 2007 build, comparable finishes, small lot, our neighborhood
D. $524K: 4000 sf, 2006 build, comparable finishes, 1 acre
E. $524K: 3500 sf + basement, 1997 build, dated, small lot, older neighborhood
So there's nothing else of our size AND finishes AND land. If you put yourself in the mindset of the buyer who says I want to live in zip code X in this price range, you'd look at the 5 comps above and ours. At what price would you say "I like that house (ours) but the price compared to the others steers me toward offering on my second choice instead." What's the price elasticity on the upper 10% of the market? Does an extra 3% in asking price really deter offers?
While we'd certainly love a quick sale, we're not desperate by any means. But we do want to avoid the trickle-down price drops that houses sometimes do. But it seems like $10K price drops are meaningless in this price range.
There are a couple houses I know of that sold for $550K last year (but > 6 months ago, so not used in the appraisal). Comparable finishes and size, not the acreage. So that price is not out of the question.
All right, so fire away. My armor is on.