From pricing treading on dangerous ground
July 21st, 2013 by Geoff Baldwin
The increasing use of “From” Pricing or “Offers Over” pricing is pushing the limits of trades practices laws and considered by many to be misleading advertising so should be avoided according to RE/MAX WA managing director, Geoff Baldwin.
“This strategy that has become popular in recent years whereby the seller sets a price low enough to attract buyers with the intention of working those buyers up to a higher price”, Mr Baldwin said.
“Personally I am very uncomfortable with this method as it often borders on being “bait” advertising and I advise sellers to avoid it and to instead consider a fairer strategy.
“Also, if the seller will not accept the lower “From” price then legislation depicts this as being a breach of Trade Practice law in that it is seen as misleading and deceptive advertising.
“The best way to turn a buyer off is to upset them the moment they ask about the true price expectation by telling them it’s advertised at ‘X’ but the sellers won’t accept below ‘Y’ so unless a seller is genuinely willing to accept the advertised price then using the “From” or “Offers Over” pricing strategy should definitely be avoided.
“There is no argument that placing a fixed price on a property is difficult as every buyer will have a different opinion so people should consider marketing a wide “Buyer Feedback Range” surrounding their expectation.
“Buyer Feedback ranging, as it suggests, invites feedback from all interested parties and is considered fairer to buyer and seller and has been used successfully, particularly in Western Australia for years.
“The records show that most properties tend to sell in the middle of the range however buyer traffic to these listings is around three times that of fixed price listings.
“For information on pricing strategies and all aspects of selling a new ‘How To’ guide, has just been released and sellers can download a free copy at the RE/MAX WA sponsored website www.hottipsforsellers.com Mr Baldwin said.
Media contact – Geoff Baldwin