Pricing Your Home to Sell | New Homes Market Center
Getting it right the first time
Pricing your home correctly is key to increasing your bottom line, decreasing the number of days on the market, and securing qualified buyers. There are several mistakes sellers unknowingly make when determining list home price that may decrease chances of good offers considerably. Here we dispel some of the common misconceptions that sellers have when pricing their home to sell.
Factors that DO affect your home value
- Location, location, location
- Property appearance
- Property condition
- Certain upgrades & improvements
- Market conditions
- Comparable sales in the neighborhood
Factors that DO NOT affect your home value
- The purchase price you paid
- The tax assessor’s value
- Your assessed value
- The actual cost of your improvements
- The current cost to rebuild your home
- Your attachment to your house
- Misconception:
I can list my home for more in the beginning and then drop the price later if needed without any negative consequences.
Reality: When a property comes on the market, it receives the most attention from buyers and agents in the first two weeks. Today, pre-qualified and serious buyers are intelligent about comparable properties. When the property is listed too high, these buyers will not think the seller is serious about selling and will move on to other listings.
Even if you drop your home price, these buyers will not be aware of the change, so you loose the opportunity to recapture them. This is where the spiral effect of loosing your equity begins. By the time you drop your home price, doubt sets in with new buyers. They think there may be something wrong with your home because it has been on the market too long – “Why hasn’t the property sold if it’s been on the market at this price?” They are usually not aware that the price was too high to begin with. Then at that point, you may end up having to drop the price again just to get the new buyers interested. We see this time and time again…get your home priced right up front.
- Misconception:
Another agent said I could get a higher price for my home.
Reality: Nobody can determine the actual selling price for your home other than the buyer. There are some agents that will accept a listing at whatever price their seller requests – then plan on lowering the price later. These agents are doing a disservice to sellers by not being honest upfront about the comparables and research of the neighborhood. They may be positioning their sellers for a downward spiral of price reductions. To get the highest price for your home, your New Homes Market Center Realtor® will carefully analyze the market and competitive properties and then make adjustments for your home to determine the exact listing price.
- Misconception:
I added over $40,000 worth of improvements to my home so my house should sell for $40,000 more than my neighbors’ house.
Reality: Not all improvements are created equal. Unfortunately, studies show that home sellers only recapture a certain percentage of improvement costs. Our experienced Realtors® can assist you with the proper adjustments on the listing price of your home based the comparable properties in your neighborhood.
- Misconception:
Another agent said they would buy my house if it doesn’t sell within a certain amount of time. That sounds like a great deal.
Reality: Beware of this type of offer. It may sound like a great deal – but you may be selling your home below market value. Understanding the market value of your home is critical, which is why we run the highest price analysis. We want you to get the most for home. We don’t suggest a price on your home to make our numbers look good; we price it to make your numbers look good!
- Misconception:
I should represent myself to save on real estate commissions to net more money on the sale of my home.
Reality: Listing your home yourself does not guarantee that you are going to net more money. Studies show that many buyers have different expectations with For Sale Buy Owner (FSBO) properties than with agent-represented properties. They assume that even before negotiations, they can automatically adjust the list price down by 6%, the standard commission percentage. From there, they expect even more negotiation room – in order to get a good deal. So now, you end up giving them a good deal AND exposing yourself to increased chance of lawsuits. It is not worth it, which is why studies show that over 90% of FSBO properties end up listing with an agent anyway.
Why not protect yourself and your bottom line right from the start?
A seasoned agent will help you price your home correctly. They will be honest with you and let you know if you might be leaning towards pricing too high. Getting the pricing right will increase the chances of multiple buyers being interested in your property. Set up your listing appointment now – there is no obligation – it’s just an opportunity to meet us and make an educated decision when it comes to listing your home. (866) 897-3777
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