This question, “How do I price my home for sale?” is front and center for most clients. In my experience it comes down to finding that sweet spot; a combination of art, science and keen familiarity with the market. In this post, I aim to give you some practical knowledge about what goes into pricing your home.
Hazards of Pricing a Home Too High
Even the best of homes, when priced too high, will not sell in today’s market. Pricing a home too high means you will be forced to eventually drop the price. When a house sits on the market it becomes stale and unappealing, at which point you risk being preyed upon by bottom feeders bearing low-ball offers. Understand that buyers walk past something priced too high. Rather than make an offer on a property outside their price range (with their fingers crossed), the vast majority of buyers simply make assumptions and bypass a home that is priced too high, and go to see homes within their target price. As with first impressions, when pricing a home you get one chance, so regardless of which agent you choose, it is imperative your home be priced right from the start!
5 Things to Know – How to Price a Home
- Historical Home Sales & Market Trends – Review past 3mo of data regarding home prices and home sales in your area and evaluate local up/down market trends.
- Viable Comps – Secure comps that truly compare like to like. An experienced agent understands the art of obtaining proper comps. This is an art, and there is far more to it than meets the eye. Because having the right comps allows you to price your home to sell, having an agent who really understands what makes a viable comp for YOUR home is key.
- Type of Market – Decide the best way to price your home based on whether it is a buyer’s or seller’s market. Because this is often in flux, an experienced realtor will be attuned to current trends and if you happen to be on the cusp of a changing market, advise you of your best pricing strategies.
- Condition of Home and Property – Address now, anything that could come up later as a roadblock to the sale of your home. While you may contend that repairs would be a nuisance, when you price your home right and sell it quickly on the other side of that work, you will be glad to have invested the time and money so wisely.
- Your Realtor’s Experience – Listen to your realtor regarding pricing. Once you find an experienced Realtor you trust, pay attention to what they say. Though their advice may be difficult to hear, if they have an impressive track record, it is because they KNOW how to price a home for sale. Note the key word there is SALE!
A special thank you to Shutter Bug Miranda Giuliana for use of her photo: Victorian Houses – San Francisco II.