
Selling price or asking price? What's the difference?
The value of a property and the price that a prospective buyer is willing to pay are not always the same and also depend on numerous factors. In order to market a property successfully, its market value must first be determined and an asking price set. The actual sale price achieved may ultimately be higher or lower than this asking price. In this respect, it makes little sense, for example, to derive expectations for the sale proceeds of your own property from a comparison with asking prices for similar properties.
The market price
The market price, market value, or fair market value refers to the average price paid for a property at a specific point in time in a specific location and with specific characteristics. Factors that influence the market price include the location, condition, and features of the property, as well as the current supply and demand on the real estate market. The market price corresponds to the result of the valuation carried out by the real estate agent using professional valuation methods and, ideally, forms the basis for the asking price.
The asking price
The amount for which you offer your property to a prospective buyer is also known as the asking price. In many cases, it is advantageous to use the professionally determined market price directly as the asking price. This means that you will not have to justify your pricing later on. However, some sellers want to allow room for possible discounts without having to fall below their desired price and therefore set the asking price slightly higher. However, this strategy is risky, as an offer price that is too high will deter potential buyers and prolong the time it takes to sell the property.
The selling price
Once you have decided on an asking price, this does not mean that you will ultimately receive this amount for your property. Interested parties often try to negotiate discounts. Sellers who are not supported by an experienced professional real estate agent during price negotiations may end up conceding a few percent of the asking price and achieving a lower sale price. On the other hand, a higher sale price can certainly be achieved if the marketing is handled professionally and the property is popular with prospective buyers due to its location and features. In very special cases, there may even be a bidding process in which several potential buyers are eager to acquire the property. With a real estate professional at your side, you will find the right pricing strategy for the sale of your property and thus achieve an optimal selling price. Because in the end, that's what matters to you as a real estate seller.
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Legal notice: This article does not constitute tax or legal advice in individual cases. Please have the facts of your specific case clarified by a lawyer and/or tax advisor.
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