Pricing Your Home

Pricing your home is both a skill and a science. Achieving the optimal price is the result of both in-depth research into comparable properties in your neighborhood, the overall conditions of your property and the current market trends.

The right price should:

• Attract buyers

• Allow you to make the most money possible

• Help you sell your property in the shortest period of time

The simple fact is, price is the number one factor that most homebuyers use to determine which homes they want to view. And it's important to remember that, although the price is set by you, the value of the home is determined by the market. Try to avoid allowing your emotions to impact your better judgment - overpricing is a common mistake that can cost you thousands of dollars in the end.

The Importance of Proper Pricing

• Quicker sale and less inconvenience

• Higher Exposure to more buyers

• Greater Realtor® response

• Generates more traffic and more advertising/sign calls

• Attracts higher offers resulting in a higher net to you

• Avoids your property to be sitting on the market for longer periods of time

What really matters is how your home measures up against the others currently offered for sale and recently sold homes in your neighborhood. Buyers will be comparing to determine where they can get the best possible deal.

Common Reasons for Overpricing

• Lack of information/data

• Over-improvements made

• Needing to net a higher net to fulfill other commitments

• Purchasing in higher-priced area

• Original purchase price was too high

• Move isn't necessary

• Assessed value

• Emotional attachment

• Opinion of family and neighbors

Dangers of Overpricing

• Most of the activity in your home will occur in the first few weeks. Pricing a home properly and then creating immediate urgency in the minds of agents and buyers is critical for a successful sale.

• Buyers who have seen most available homes in their price range are waiting for the "right house" to come on the market. That's why if a house is priced right, it will sell quickly. The buyers are there waiting for it.

• Don't ever start with a high price with the assumption that you can reduce it later. By the time you decide to lower the price, it may be too late, as interest will have already declined due to long period of “Days On Market”

• A major cause for concern is appraisal issues; overpricing can lead to loan rejections, appraisal gaps and lost of time for sellers and buyers.

• Even if your home is in better conditions than other homes in the same area, your house won't be picked for viewing if you set the price too high.

• Buyers and their agents become aware of the long exposure period and often are hesitant to make an offer because they fear that something is wrong with the house.

• Attracting the wrong buyers that are not 100% committed to purchase your property.

• Fewer potential buyers will respond.

• You might help your direct competitor (your neighbor) sell similar homes that are priced accordingly.

• You could lose money as a result of making extra mortgage payments, taxes, insurance, HOA and unplanned maintenance costs.

The Role of an experience Real Estate Agent in Pricing

• Provide you with a comparative market analysis (CMA), a comparison of the prices of recently sold homes that are similar in terms of location, style, and amenities. A CMA is performed by comparing previously sold homes in the area, and currently active homes to know your competition.

• There is no "exact price" when it comes down to pricing real estate

• We don't tell you what we think your home is "worth", we go over data and trends, The market determines value…together we determine the price.

• You determine the price based on the factors you control:
      - Marketing time
      - Financing alternatives provided
      - Condition
      - Exposure / marketing efforts

• Keep in touch with market trends and keep up to date with recent market activity of comparable homes.

• Estimate your sales net proceeds.

An agent has NO control over the market, An agent can only control the marketing plan and the exposure a property gets. Never select an agent based on price.