An end to all that?

One of the brokerage firms in town – Prudential, I think – has been running some odd little campaign where their listings are priced so as to end with 876 dollars. I have no idea what the point is – didn’t get the memo, I guess – but I notice today that 62 N. Stone Bridge Rd, previously priced at $1,644,876 has been reduced to $1,640,000. I don’t believe a $4, 876  reduction is expected to flush buyers out of the shrubbery – certainly no such fortunate thing has happened since September, as this price was slowly reduced from $1.830 million – so perhaps the marketing campaign has ended and more traditional pricing is coming back.

Or not – I’m just guessing. I’m also guessing that a 10% cut from September ’til now won’t be enough to move a house in today’s market, but perhaps I’m wrong about that, too.

3 Comments

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3 responses to “An end to all that?

  1. Prudential Value Range Marketing is an exclusive program designed for adjusting markets. Since most buyers search for properties by selecting a price range and most brokers provide sellers with a suggested range of value, the program makes perfect sense for today. Like eBay or an auction house, the seller establishes a minimum bid and agrees to counter or consider any offer that falls within the selected price range. For instance, rather than marketing a property with a traditional fixed price of $2,195,000, the seller can select a range from $1,795,000 to $2,094,876. The range in this case has a 14% spread and sends a message to the buyer that their bid will absolutely be considered. It is simply a means of getting the conversation started and the 876 identifies the property as being priced using the VRM method. The numbers 876 correspond to the numbers on a telephone keypad. You might ask if a buyer will begin with a bid at the lower end of the range and the answer is probably yes. The operative word, however, is “bid.” Admittedly, these days many buyers look at asking prices as meaningless and start their bidding much lower than 15%, even for well priced inventory. That’s probably a different discussion. For now, Prudential Value Range Marketing is working well throughout Connecticut and in many other parts of the country. It has been especially successful in high end markets on the west coast in cities like San Francisco, LaJolla, and Beverly Hills.

    • christopherfountain

      Cool, Eric – now I have the memo! But what happened to the $846 on Old Stone Bridge?

  2. Retired IB'er

    Eric,

    I can tell you unequivocally as I consumer that I key in on the low end number, completely dismissing any thought as to the range. Moreover, I assume my discount to the lower number, without any thought for falling within the range.

    The only benefit I see to this approach is that selling agents may be able to use it to persuade delusional sellers by pointing to the high end of the range, while signalling to buyers a more realistic price.