Pricing Your Home for a Successful Sale

A home's Market Value, simply put, is what a buyer will be willing to pay and a seller will be willing to receive for a property. A home priced at fair market value is set for a successful sale.

When you are deciding on what price to list your home at, there are five statements that you should set aside from this thought process:

1. What you paid.

While the amount you paid for the house will definitely help in the decision of whether you should or can sell, the buyer will not factor in what you paid when deciding what to offer for the property.

2.  What you need or want.

It's easy to say, OK, I NEED a certain amount because I am moving to a more expensive part of the country and it will cost me more to get a similar house. Once again, the question "can I get what I need" will factor into your decision of whether or not to sell the house at all.

3.  What your neighbor says.

Neighbors talk, and they might not know the whole story. While a house down the street may have listed at a certain price, they may not know what the house eventually sold at. Neighbors also have a vested interest in you selling at the highest price possible (which is of course our interest, too), but they may not understand the risks of overpricing and longer days on market.

4.  What another real estate agent says.

Beware the agent that says they can get a high price without the comparable sales in the neighborhood to back it up. It's tempting to choose an aggressive agent but you may find they used this approach to get the job and soon will ask for a price reduction after they have you in a listing agreement. Choose the agent that approches your market value from a data approach that has concrete reasons for why they think the house will sell at a certain price.

5.  What it would cost to rebuild your home today.

Some additions, the best example of which is a swimming pool, do not add their entire cost to the value of the home. These additions will help the house sell faster, and add some value as well as enjoyment while you are in the home, however if you add the entire cost to rebuild you will most likely overshoot the value of the property. The best approach is to review similar homes with similar features and base your value determination off of these success stories.

What is the best way to determine a fair price? 

Look at the past, present, and future... otherwise known as solds, expireds, actives, and pendings in MLS.  Similar homes give a good picture of what buyers have been willing (and not willing) to pay.  

Realtors present this information as a CMA or Comparative Market Analysis. This report takes similar listed homes into account and gives you a good range for a price that would be expected to generate a successful sale.

Click HERE if you would like to request a CMA for your home!