Pricing Your Home
The art and science of pricing a home go hand in hand. To determine the optimal price for your property, you need to research comparable properties and use your gut feeling about the current market and the property.
The right price should:
- Attract many buyers
- Allow you to sell for the most money possible
- Help you sell the home quickly
Despite setting the price, it's important to remember that buyers decide the home's value. Homebuyers often determine which houses they want to view based on their budget. Don't let your enthusiasm override your better judgment - overpricing is a common mistake.
Proper pricing is essential
- Reduced inconvenience and faster sales
- Increased exposure to more buyers
- Increases Realtors® interest
- Generates more sign calls
- Attracts better offers
- It means more proceeds to the seller
- As a result, it does not become "shopworn."
In your neighborhood, what matters is how your home compares to those currently for sale and recently sold. There will be comparisons between buyers.
The most common reasons for overpricing
- An over-improvement
- The seller needs more money
- Purchasing in a high-priced area
- The original purchase price was too high
- Lack of factual data
- Bargaining room
- The move isn't necessary
- Assessed value
- Emotional attachment
- Family and neighbors' opinions
The dangers of overpricing
- You will see the most activity on your home during the first few weeks. It is important to price a house correctly and then creating immediate urgency in the minds of agents and buyers.
- In their price range, buyers wait for the "right" house to become available after seeing the most available properties. When a home is priced correctly, it will sell quickly. Buyers are waiting for it.
- Putting a high price on the table and then reducing it later is not a good idea. When you decide to lower the cost, interest may already have waned.
- Overpricing can lead to loan rejections and delays due to appraisal problems.
- It does not matter how good your house is compared to other homes in the area. If its price is reasonable, it will be picked for viewing.
- As a result of the long exposure period, buyers and agents are often afraid to make an offer fearing something is wrong with the property.
- You need to attract the right buyers.
- Fewer potentially qualified buyers will respond.
- You might help sell similar homes that are priced low.
- You could lose money as a result of making extra mortgage payments while incurring taxes, insurance, and unplanned maintenance costs.
The Role of a Real Estate Agent in Pricing
- Compile a comparative market analysis (CMA), which compares the prices of recently sold homes of similar location, style, and amenities. The purpose of a CMA is to know your competition by comparing previously sold homes in the area with current active properties.
- Real estate does not have an "exact price."
- You won't be told what your home is "worth."
- Value is determined by the market...price is determined by us together.
- The price is determined by the factors you can control:
- - The length of time it takes to market
- - Alternative financing options
- - Condition
- - Exposure method
- Keep in touch with market trends and keep up to date with market activity of comparable homes.
- Estimate your net proceeds.
- Help to determine offering incentives.
An agent has NO control over the market, only the marketing plan. Never select an agent based on price.
Thinking about selling? Find your home or condo's value in today's market, for free.