Understanding How Buyers Search for Homes
To understand how to price your home you have to first understand how home buyers search for homes.
When a buyer fills in their search criteria they begin with a wide range of prices.
Dropdown menus on these tools show prices in round numbers only.
For example, in these screenshots from Zillow and Trulia below, you can see prices are in round numbers, with $50,000 increments in the upper ranges:
Even when the online search tool allows the buyer to enter numbers manually, home buyers still choose round numbers. For instance, with MLSPropertyFinder, the home buyer is allowed to enter any number for price. To test this we took a sample of home searches this week on MLSPropertyFinder, and found that all of the buyers indicated price ranges in round numbers like $250,000 or $300,000—none with price ranges in odd numbers.
Since home buyers search this way sellers need to keep this in mind not only when pricing there home for sale, but more importantly when they make a price adjustment. For example if your home is priced at $429,000 and it is not selling, dropping it to $414,000 really is not going to get any new eyeballs on it. But dropping it to $400,000 even would show it to all the buyers looking up to $400,000.
Remembering how home buyers search for homes will give you guidance on how to price your home to get the most exposure and get it sold.
Related: Pricing Your Home