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Many of you coming from other areas may not be familiar with Value Range Marketing in terms of pricing homes on the MLS.

Sellers and buyers often have a price range in mind when they are looking to sell or buy. Here in Southern California (and other areas as well) it is becoming more common for sellers to state a range of price when listing their homes, at the urging of their REALTOR, in order to more effectively market the home, say proponents of the method. For example, a home may be listed at $575,000 - $625,000 and the listing will state that the sellers will entertain offers in that range. VRM stands for the numbers on the dial pad of your phone that correspond to these letters, and it is fairly common to see the last three digits of the price range be 876 ($625,876), especially if the MLS will not allow you to put a range in the price data field. Sometimes the range may be very broad, especially for higher-priced homes, while other ranges may be quite narrow. You will often see a spread of about 10 - 12% but there seems to be no agreement on how it is done.

There is no guarantee that an offer in the range WILL be accepted, however, since the contingencies may not be satisfactory to the seller. And the final offer that is acceptable to the sellers may be near the top of the range or closer to the bottom. And buyers can, if they wish, submit an offer lower than the range, which may or may not be acceptable. Proponents of the technique say that, because it opens up a wider range of buyers due to the broader price range, homes priced this way sell faster and for more money. But there are studies that suggest this may not be so.

While more common in this market, this method remains somewhat controversial both with consumers and agents, and many do not understand nor agree with it. But now you know a bit more and will be better prepared when searching for a home. Talk with your REALTOR so you will know how to proceed.

And if you are listing your current home for sale, you may want to discuss this strategy with your agent. If this method is common in your area it may make sense. But if  no one uses it, acceptance and understanding will be more difficult. It may be helpful, or not.