When you’re putting your home on the market for sale, pricing it properly is one of the most challenging, yet important parts of the whole process. Price your home too high and it sits on the market for too long, or the appraisal comes in low and your buyer can’t get the mortgage they need; price it too low and it sells quick but you, as the seller, feel undervalued or like you missed your opportunity to get the most out of the deal.
How do we navigate this sticky issue? You probably know what I’m going to say…consult the data. As somewhat of a data, pricing geek, I love this stuff. So, if you are wondering how we go about pricing to get you the best offers and a smooth transaction, this is what I tell my sellers to keep in mind when we’re working on pricing their home.
Tip #1 – Remember the laws of economics. Your home is only worth as much as someone is willing to pay for it. This may sound simple—and a little harsh—but many sellers I work with forget this law and instead think their home is worth what they want to sell it for. Pricing it at what the seller thinks its worth, often results in the home having lots of showings but no offers.
Tip #2 – Mind the data. So, if a home is only worth what a buyer will pay, how does the buyer know what is a reasonable price? They—and their real estate agent—look at other homes in the area, what they sold for and how their features compare, how many homes are on the market, etc. When pricing a home I look at the same data that appraisers will examine when appraising your home, and I visit the homes in the area so I have first-hand knowledge of the comparable homes. Using this strategy we can come up with a reasonable price and be pretty sure the appraisal will agree with us; making the whole transaction run smoother. For more, see my infographic on factors that affect the sale of your home.
Tip #3 – Know your goals. How quickly do you want or need to sell your home? Is there a certain price you have to get in order to pay off the mortgage or make the finances work for your next purchase? These are all issues you need to consider and we need to discuss because the answers help determine the listing strategy.
So, when you decide to sell your home, pricing it right can really make the whole process so much more pleasurable and less frustrating. I work very hard to know all of the data supporting prices in our local area so if you ever have any questions about selling and pricing your home, please let me know.