Home on a Range
I came across this 5 bedroom, 6 bathroom listing the other day in San Diego, and was taken aback by the following description:
“Seller will entertain offers between $5,050,000 and $5,999,876.”
Why would any agent put in a range as broad as this? My first inclination is that a buyer would begin to offer at the lower end of the range and the likelihood that the property would sell at the upper end is quite low.
I then came across this post by Bryant Tutas with a good analogy on range pricing and that in his opinion it works. The comments are also quite informative.
It will be interesting to see what this house sells for. I guess time will tell.
`
mike said,
October 11, 2006 @ 10:54 am
range pricing seems rather silly to me, especially in a falling or stagnant market you’ve already signaled to the buyer a low-end value that you’re willing to accept is, and w/ the san diego market being as slow as it is, i can’t see it doing any good. buyers seem lucky to get an offer at all, so i don’t know what sense the range makes. i remember learning the #1 rule of price negotiation is that the first side to mention the price sets the ceiling, and in this market i would consider the lower number in the price range to be the ceiling in my offer and negotiations.
amber said,
October 17, 2006 @ 3:12 pm
This comment has been removed because it is off topic.
PlanOpen said,
December 27, 2007 @ 10:56 am
No price is ever set! A range gives the buyer an idea that they may save a lot on a property that is actually wroth a lot more.