What Is Range Pricing Real Estate
Not all Multiple Listing Services (MLS) in the US allow real estate agents to range price a home. The Tucson Multiple Listing Service does allow range pricing as an option when listing a property in the Tucson MLS.
Many people don’t know what range pricing is and how it can be used to benefit a seller.
Range Pricing
Range pricing is a marketing technique and a feature in the Tucson MLS where you can put a bottom-end and a top-end price when listing a home. Traditionally, when a property is listed for sale, it is placed on the market at a fixed price. Under ranging pricing, the property is marketed within a range of values, rather than one specific price. It is important to understand that range pricing is simply a marketing tool that real estate agents and sellers can elect to utilize (or not).
What Are Pros of Ranging Pricing a Tucson Property?
First, determining a property’s value can be somewhat subjective. Range pricing can take some of the subjectiveness out of the listing price by offering a range that a seller would accept or counter a buyer’s offer.
Second, ranging pricing is a marketing strategy that can attract a lot more prospective buyers. Why is this? Because when a property is listing in the Tucson MLS as a ranged price listing the $ per square foot is calculated using the lower end of the pricing range. Consequently, a range price listing can look more attractive to a buyer because the $ per square foot is lower. Thus this strategy may attract more buyers.
Third, depending on if we are in a seller’s market or a buyer’s market range price can be very effective in a buyer’s market due to the buyer asking for seller concessions.
When we are in a buyer’s market many of the offers a seller will receive will have seller concessions. Range pricing allows a seller to say… at the top end of the range seller WILL accept offers with seller concessions and at the bottom end of the range, the seller will NOT offer sell concessions.
Or if a cash deal and a quick close… the seller WILL accept offers at the bottom end of the range price.
Or if the buyer is getting a VA loan, asking for a longer closing, or maybe asking for more repairs… the seller WILL accept offers at the high end of the range price.
Lastly, listing your home in Tucson using range pricing may kick you into a lower price bracket which can attract a lot more buyers.
To learn more about Price Brackets: CLICK HERE
What Are Cons of Ranging Pricing a Tucson Property?
In spite of the many benefits of range pricing a property, there can be some downside.
Regardless of what you tell buyers and buyers agents to justify the range price what number to you think buyers are going to gravitate toward when making an offer? The lower end, of course.
As such, sellers must understand they might receive offers at the lowe end of the range price rather than their ideal higher end of the range price.
Range pricing can be misleading for buyers. If the listing is done correctly as to the proper verbiage it can remove some of the confusion and be less misleading to buyers.
What Sellers Often Do Not Understand
What sellers often forget is that range pricing listing is attracting more visitors, which means more offers will likely be made, resulting in organic price inflation and a potential bidding war.
That means sellers might end with multiple offers which at the end of the day could lead to more money in a sellers’ pocket.
Is Ranging Pricing Right For You?
A range pricing marketing strategy is not ideal for all markets and all sellers.
Being open to the idea is worth the potential upside to a property seller when listing a Tucson home.
Consult with us to see if this strategy might be right for you!