Sellers, Stay Realistic on Price and Don’t Count on the Outlier Showing Up

We’ve been witnessing dramatic overbids and sky-high sale prices in San Francisco for years now. But when it comes to sellers setting their value expectations, I have some advice: Don’t count on the outlier buyer being in your offer mix.

This type of buyer goes way above the comparable sale range for a property type or neighborhood, often prompting your neighbors to meet in the street and exclaim, “I can’t believe someone paid that price for that house!”

Of course, it’s certainly possible that the outlier buyer will fall in love with your home and match or exceed the highest comparable sale. But it doesn’t always happen, because most buyers in a multiple-offer situation aren’t willing to go as high as the outlier.

For example, let’s say you’re putting your three-bedroom Central Sunset house on the market. Your agent runs some numbers and shows you that the comp range for your property is generally $1.4M to $1,750,000. But there is one home in the batch that sold for $1,850,000.

Your agent has done a little intel, and finds out that this $1,850,000 comp involved 15 offers for the seller. But only one buyer offered that $1,850,000. The other offers? They topped out at $1.7M and went down from there. Had the outlier not transpired, you would have topped out at a much lower price.

Once your property is on the market, you’ll quickly find out where the market is for it. Make sure you have realistic expectations on price, and know that there’s not a guarantee the outlier buyer will transpire on the offer date.

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Get in touch:

Eileen Bermingham

Zephyr Real Estate

415.823.4656

ebermingham@zephyrsf.com

BRE# 01352627

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