Pricing your home correctly for sale can be a tricky situation. When talking numbers in the hundreds of thousands, it’s easy to gloss over about 10k here or there.
But take a second to think of what that money means to you. If you throw a random price at the market, you could easily miss out on a year of college tuition, a down payment on another home, or even a year’s salary.
On the other hand, it is equally easy to be blindsided by optimism and completely price your home out of the market.
A little research and legwork to define your home’s price can help set you up for a simplified selling experience while maximizing your ROI.
Here is a list of items to consider when pricing your home.
1. Consider Online Calculators
Online calculators are a great start because they’re quick, easy, and, most importantly, free. A little bit of research can help you decide whether or not it’s a good time to sell at all. Also, because online estimates can vary, you should try to get a price from multiple sources and then weed out the extremes. It will give you a fair idea of the current prices in your area.
But these calculators are only to give you a start. The data they collect is extremely generic, including the square footage, beds, baths, and neighborhood comparables. They don’t do a physical walk-through, so they don’t know if your house is better or worse than similar houses in the area. Once you’ve come up with a general idea about the price, you are ready to move on to the next step.
2. Use a Real Estate Agent
After getting an estimate, it’s time to get the experts on board. Listing agents offer a free walk-through and a Comparable Market Analysis (CMA). A CMA typically includes:
• Comparable properties
• A listing of the factors unique to your property
• A robust analysis of the current market conditions
While you can spend a few minutes online and gather information on the listed values of comparable properties, real estate agents have the experience to know if your house is overpriced or underpriced. They also conduct a CMA to evaluate all the data that affects your values. As a result, they help you develop an accurate and realistic listing price that would attract buyers.
3. Think Like A Buyer
When pricing your home, you need to think like a buyer and not as a seller. Be logical and rational. For example, when you look at your house among a list of comparables, imagine being a buyer and then see which one you’d buy.
A good agent can help you have a realistic approach to this. Their expertise can help you understand what would appeal to the buyers and then position your property and your price accordingly.
4. Understand Comparables
Market analysis, lists, and various comparisons make up your comparables, and it’s easy to get lost. Having an agent who understands your needs is a great asset. The real estate agent will walk you through all the numbers and help you understand the comparables.
The buyers will visit a few of these comparables, and you should, too. There’s nothing like walking around a house to see how it stands up against yours. Also, looking at comparables currently active on the market gives you a good picture of what houses in your neighborhood don’t sell and why.
Additionally, try to find out as much as you can about similar properties sold and their price points. It will give you a fair idea of how much you can expect.
5. Know the Market
Take a look at what local houses were selling for up to a year ago and now. Does the line point up or down? Depending on if you are in a buyer’s market or sellers, you can play a bit with your final figure. But you should keep in mind that buyers will look to negotiate.
The housing market fluctuates cyclically throughout the year. While it’s not impossible to sell a property during the winter, you’re much more likely to have success in the spring. If you’re trying to sell a home fast, it is best to list no earlier than February; this allows you to take advantage of the heavy activity as buyers usually start looking at properties around this time.
6. Zero in On A Dollar Figure
After you have all the information you need based on online calculators, CMAs, an understanding of your comparables, and your local market conditions, you are almost ready to list a fair price. Having an agent work with you further helps you narrow down the range to what you are comfortable with while still getting the best dollar value for you.
Your real estate agent will also let you know the mean price in your community to set a competitive price. If you need to sell quickly, consider pricing your home slightly lower than the mean to attract interest. Sometimes this may kick off a bidding war. If you haven’t received any offers by a specific date, consider lowering the price.
7. Fix to Add Value
The fair price of your home takes some things for granted, such as a fresh coat of paint, spotless floor coverings, well-maintained landscaping, and you’ve decluttered your space. However, if you go above and beyond these, your selling price can reflect it.
Some ideas include adding space and light, color-coordinating appliances in the kitchen, boosting curb appeal, modifying the bathroom, and converting an extra room into a home office. A quick online search returns a plethora of cost-effective fixups to help you add move value.
Be Resourceful and Research
With enough research, you should know about comparables, especially when your real estate agent helps you out.
If every house on the market has granite countertops, this amenity will be expected at your listed price. Ensure that you know what actions you’re taking and how it affects your home’s value.