List Price: Lower than or at ARV ?

Question

To all house flippers out there, do you list your house at ARV? Or do you list below ARV to create a bidding war? What are your strategies? Here is a little info on my property:

Fully renovated property. Located in Garden Grove, California. (Orange County).

1. The house is on a major street, however none of the comps on the same major street are fully renovated - and those comps sold for $575K.

2. My house is 200 sq. ft. larger than the next largest house on the street.

3. Other comps (not on the major street) sold for $630K-$670K and are still not as big as mine.

Just curious as to what you would do?

Holly McDowell · Answer

Hi Chris,

The answer depends on a few factors.

1) What is the average days on market for the comparable properties?  Does this align with your target sale date?

2) Are comparable homes selling at/above/below list price?

2) What other inventory is available that a prospective buyer would consider?  How would your property compare?

3) Some buyers will be turned away by a low price and are not at all interested in participating in a bidding war.

4) How much does the price need discounted because of the street?  Size alone will not offset the location if it is only a few hundred square feet.

In the properties I have renovated and sold, I tend to price just under the target ARV.  This generally has resulted in a quick sale, less holding costs, and a solid buyer.

Please let me know if you need any market information for Garden Grove.  I'd be happy to assist.

Holly