Your home is typically the most significant investment you'll ever make, so when it’s time to sell, you want to ensure you get as much as possible. But how do you choose the best price to list the home?
Accurate house pricing is essential for success. If you set the price too high, it will be on the market for a longer time. If the price is lower than it should be, you’ll receive offers below what you need to help purchase your next home.
Setting the price point for your home needs careful consideration, and there are a few things you can do to get the perfect price.
Let's examine what it takes to price a home correctly.
There are a few different ways you can find the best price to list your home for:
Checking the value of your home online is easy, but does it do an excellent job of estimating how much your home is worth? While these services might use recent sales data and details about your home to produce their result, they could be inaccurate.
These automated valuation models used by websites like Zillow aren’t perfect. You will likely get different results if you check valuations on different websites.
Services like this can indicate your home's worth, but you need a more accurate assessment.
Your real estate agent can assess the value of your home using comparative market analysis. The CMA builds on the Realtor’s local market knowledge and uses recent sales data from similar homes to find a more accurate house pricing result.
The real estate agent will better understand what is happening in the market, producing a more accurate result than an automated valuation ever could. They will factor in sales prices, the average days on the market, the price per square foot, and more to give you better information to price your home to sell.
While a lender usually requires home appraisals before providing funds, you can also hire an appraiser to value your home. The appraiser has to be independent to give an objective view of what the home is worth.
The licensed appraiser will use comparable sales data similar to the CMA. They will also walk through the home to better assess the condition and upgrades you might have made. The home's location will also be considered to provide a fair assessment of the value.
Keep in mind the assessed value has nothing to do with the fair market value.
Pricing with precision is essential wherever you are located.
A buyer can offer what they think the home is worth, but the listing price is crucial to set expectations. It influences how potential buyers view the home and any offer they make.
When a home is overvalued, it will put many off making an offer for fear of paying too much. This inevitably means the home will stay on the market longer than it needs to, which could make buying another home more difficult.
If the home is priced lower than it's really worth, you stand to lose out when it’s sold. Lower-priced homes might also make buyers think there is some problem with the property. You might appear to be desperate to sell because something is wrong, preventing buyers from making an offer.
An experienced realtor's advice can guide you toward a price point that avoids these problems. The price should consider the direction of the local market, along with the features your home offers.
If your property has some unique features like a gorgeous finished basement, this might not properly be represented compared to other homes.
If many buyers compete for homes, lower pricing could increase interest, resulting in offers from multiple buyers. This could trigger a bidding war, pushing up the price of your home.
Sometimes, it might be necessary to drop the price of your home. If things change in the local market, perhaps influenced by national trends, it is essential to be willing to alter the price to find a buyer.
If buyers’ expectations change, and your price doesn’t, your home could be on the market for a long time.
If you stubbornly refuse to reduce the price, you could have no choice if you want to find a buyer. The longer your home stays on the market, the more you could lose if house prices are trending downward.
While online valuations are quick and easy, they don’t give you the most accurate price to sell your home. A Realtor or appraiser assessment will help you find a price that sells your home, giving you more to fund your next purchase.
Remember that home pricing is the #1 factor in selling quickly for top dollar. Pricing mistakes lead to homes languishing on the market and selling for less.