Do Oddly Priced Homes Sell Faster?

    The Washington Post is reporting that a recent study at Cornell University has found that people will pay more for a house if the listing price does not end in several zeros.

   "It's a psychological bias," according to a professor of marketing  at Cornell's Samuel Curtis Johnson Graduate School of Management. "A bias in judgment."

   The study concluded that because people are used to precise numbers for items that don't cost much and to round numbers for large amounts, consumers generally and home buyers specifically tend to perceive that a price is smaller if the digits at the end are not zeros.

   "It does seem ridiculous," said the professor. The results were confirmed in laboratory tests with 134 graduate students and by examining real estate transactions in South Florida and Long Island, NY where most list prices had three zeros at the end.

   Now I admit my first thought was "Gee, I hope they didn't get government funding for this study", but they probably did so let's get over that and examine the results.  In a "laboratory" experiment they asked 134 graduate students who probably have no money and are not even remotely in the home market, what price they would pay in a hypothetical situation and then compared it to real transactions that actually occurred in the real world and from this they determined that a home priced for $484,700 would sell for $1,380 more than a home priced at $485,000. That's pretty definitive.

   We don't have a laboratory and we don't engage in hypothetical situations.  Here at Newcastle Square Realty all we do is sell homes. Lots of homes.  We are the leader in our market area.  We find that real buyers here in the real world who use real money to buy real homes think very carefully about their purchase. They use a professional Buyers Broker to help them gather all of the relevant data about homes that meet their needs in the community where they wish to live.  They negotiate to make their purchase at the best price and under the best terms and conditions they can get.

   Todays home buying consumer is highly sophisticated and well advised.  Todays Sellers need to be just as sophisticated and just as well advised.  The homes that sell for the highest asking price to sale price ratio, in the shortest period of time are those homes that are priced properly relative to the market and then prepared in such a manner as to make them attractive and welcoming to those sophisticated buyers.

   There are no shortcuts or magic tricks that will cause someone to give someone else more money, at least not here in the real world.  If you are a prospective Buyer or Seller of real estate and would like to be advised by a professional, highly experienced real estate broker who will use knowledge and hard work to help you achieve your objectives, please call our office and we'll be glad to work with you.  If you are a dreamer or a schemer who would like to engage in hypothetical transaction,  I'm sure there's someone somewhere doing a study who would like to talk with you. And that's my "bias in judgement".

Jim Cosgrove

Bald Eagles in Maine

  In other states folks get all excited when they see the first Robin in the spring.  Here in Maine we watch the Eagles all winter long.  This is a truly remarkable creature, the population of which has made a comeback since the days of Rachel Carson and Silent Spring.  It's amazing what nature can do when we just leave it alone.

   This video is from a nest up in Hancock County to our north where someone has rigged up a camera.  There are several active nests in our area and three that I know of on Damariscotta Lake.  I have seen Eagles land on the ice to eat low value fish such as perch and pickerel left behind by ice fishermen in search of salmon and togue.

Jim Cosgrove

Damariscotta Mills view of Eclipse

   It was a beautiful and clear night (if somewhat chilly) in mid coast Maine and the eclipse was spectacular.  Look carefully and you'll see Saturn and Regulus.  Click on this to enlarge on your screen.

Tom Field 

Moon over the Mills

   One of the many great things about living in a rural area is watching celestial events that are not ruined by the light pollution of a city.  Wednesday night should be one of those times as we witness another lunar eclipse at about 8:43 PM.  According to the news that I have read this is the third eclipse this year but apparently I slept through the other two.

   There are some great places to view the eclipse in Lincoln County.  Pemaquid Point by the lighthouse would be one and somewhere in the middle of Damariscotta Lake another (careful on the ice, we just had a lot of warm rain) or really in anyones backyard who doesn't have too many trees (always best of course if it's the back yard of someone you know).  Since no lunar eclipse that is enjoyed outdoors can be fully appreciated without a beverage may I suggest a hot toddy is appropriate for a cool February evening?

   If you aren't lucky enough to live here in mid coast Maine and still want to see the show here is a link to a schedule of where and when it will appear.

   If you want to see the next one here in Maine, please give me a call and lets see if we can find you a back yard of your own that has a good view!

Tom Field

Stimulus Package to Become Law

   The following was just released by the National Association of Realtors:

This afternoon President Bush will sign the Economic Stimulus package into law. Last week, Congress gave overwhelming final approval to the Economic Stimulus Package supported by NAR and REALTORS® across the country. As a result, the government will be sending payments to most American households and grant tax incentives for business investment.

The legislation includes the requested GSE and FHA limit increases strongly backed and lobbied by NAR. The increased GSE loan limits means borrowers will see immediate relief with new liquidity in the mortgage market and the nation will see an additional 300,000 home sales. The increased FHA loan limits means an additional 138,000 Americans will purchase homes, and with the needed FHA reforms means 200,000 families can refinance their homes safely and affordably.

  It sure sounds good!

Prepare Your Home To Sell

   Here in Mid Coast Maine we are truly in a very competitive Buyers market.  In order to stand out from the crowd not only does a home need to be priced competitively but it also has to look it's best.  It sometimes takes Buyers several visits to a home before they decide to actually buy it but they can often decide not to buy it in the first few seconds of their visit.  Almost every broker can tell you stories of people running out of homes because of cigarette smoke or cat litter odor and I know that early in my career I lost sales because Sellers just weren't astute enough to tidy up.  Now I give them a copy of our Market Preparation Guide and if they don't follow it I fire them!

    For those Sellers who really want to give their home a leg up on the market we recommend the use of a professional home stager.  We have seen homes completely transformed in the hands of a good home stager.  Here's an excellent video from Boston Home Staging to give you an idea of what can be accomplished:

 

   For a free copy of our Market Preparation Guide send me an email and I'll be glad to provide you with a PDF copy.

Jim Cosgrove

Super Bowl Sunday

    The New England Patriots will be playing in the Super Bowl Sunday night in Glendale, Arizona.  No doubt local TV reporters will be doing live shots from poolside at their hotels before the game.  The sun will be shining, folks will be frolicking in bathing suits in the background and the reporter will have to tweak his co workers back at the studio by telling them that "it's kind of chilly, got down to 68 last night" or some other such thing.

   At this point the good woman who shares my life will look at me and say, "I'm glad we live here where there are no scorpions, please pass me my sweater."  But, there is a chance that your better half may see things differently.  If that happens and you find yourself browsing Arizona real estate websites (see our blog roll on left), be sure to give one of our professional brokers a call for an opinion on where your present home fits in our market. Or, if you're one of those poor souls that's stuck out there in all that heat and blazing sun, just dreaming of how you'd like to have a home where you could go ice fishing right outside your door, well we can help there, too.

   We probably won't be in the office Sunday night but we'll return your call first thing Monday morning.

Jim Cosgrove