Some hotel owners make pricing mistakes that can delay the sale of their property when it is listed on the market. This article discusses some of the key pricing mistakes that you should avoid making when you decide to sell your hotel.
Setting a Very High Asking Price
Some hotel owners may think that they will get more from the sale of their hotels if they set a very high asking price. This approach may not be advisable because many hotel buyers usually have objective grounds upon which they judge the fair price for a given hotel. For instance, the prospective buyer may base his or her computation of the fair price of the hotel on a multiple of cost of staying at the hotel for a night. Such a prospective buyer may not bother contacting you in case he or she considers that you have overpriced your hotel. It is therefore advisable to set an asking price after conducting an objective valuation of that property so that you attract many possible buyers.
Delaying to Reduce the Price
It is a mistake to keep postponing the reduction of your asking price in case you don't receive the kind of offers that you had expected when you listed your hotel on the market. Your delay to reduce the asking price is likely to have a negative effect because potential buyers will lose interest in your hotel due to the extended time that it has spent on the market. It is better to be swift in decision making so that you reduce the asking price as soon as you notice that the sentiments of the market regard your current asking price as too high.
Willingness to Accept Lower Offers Without Altering the Asking Price
It may also not be advisable to express a willingness to entertain significantly lower offers than your listing price when that listing price has remained unchanged. For instance, it may not be good for you to retain a listing price of $5million if you are willing to consider an offer of $3.5million. Lowering the asking price to a figure that is slightly higher than the final price you are willing to accept will attract more interest in your hotel. This is because many potential buyers may be more likely to judge your asking price as reasonable for that property.
Setting the asking price for a hotel is a complex process that involves putting into consideration several factors, such as the location of the property and its reputation in the market. It is therefore advisable for you to work closely with an experienced hotel broker so that he or she helps you to avoid making any mistakes that can potentially jeopardise the speedy purchase of your hotel.