What is "Value Range Marketing"?

You may have heard of a term called, "Value Range Marketing" or "Value Range Pricing"; though if you're in the Central Ohio area, you probably have not. It's not that big here, yet. And who knows, it may never be. But let me tell you about it.

Value Range Marketing (VRM), aka Value Range Pricing (VRP), is a common practice in some real estate markets where a seller will indicate a price range in which a home seller will entertain offers. This is as opposed to setting a fixed price for a house.

For example, a seller in Ohio may sell their home for $225,000. A listing agent and seller using VRM may set the price at a range of $210,000 to $239,900. This means that the seller will consider any offers made starting at $210,000 (though they do not have to accept an offer if it comes in at $210,000).

Proponents of this marketing method say that homes using VRM sell faster and for higher price.

Most people that have never heard of it think, "Why the heck would I offer $225,000 on a home if the seller's marketing campaign is already telling me that they'd consider an offer of $210,000?"

What this VRM does is it gets the ball rolling. It gets offers in, and the hope is that though the first offer may come in low, at least they can begin Countering back and forth until they reach a price point that both parties are happy with.

Here's my take on this whole VRM thing: I see both sides of the story here. I can see why this method of marketing is successful in some areas. But right now, I don't think it would be successful here in the Central Ohio market. For one thing, the local MLS does not give the option of entering a Value Range. So, every property has to be marketed in the MLS with a fixed price. The price range has to be listed in the MLS remarks, and since it's an uncommon method here, most buyer's will just assume that if the range starts at $210,000, they will be able to get the home if they offer $210,000. So, it may work in some areas. But right now in Central Ohio, unless you have a good Realtor who know about this method, you could just be wasting your time. (A good Realtor, who knows about VRM though, could explain this marketing method very well to potential buyers and buyer's agents, and it could actually work well to bring in offers. Again, it needs to be a good, knowledgable Realtor though - like me).

Call me if you'd like to know more.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com