Pricing a home is an art, not a science. In most cases, the best practice for establishing value is to look at what other similar homes have sold for. Then make additions and subtractions based on the differences. It can also be valuable to go out and take a look at the competition. Put yourself in the buyer’s shoes and be objective. Every market has a handful of very unique, special properties that could warrant pushing the envelope with price but in general, most properties can be priced well by relying on the data. Tap into your real estate broker’s knowledge to determine this and try to remove emotions.
Let’s explore a few myths about pricing your home to sell.
Not such a great idea and for a number of reasons! In hot, seller’s markets, there are buyers waiting for new inventory. The way technology works, buyers know what is brand new on the market, and many only focus on these properties. If your home is overpriced, to begin with, you are losing the largest pool of immediate buyers as the buyers that are waiting for a product like yours are moving on based on the price tag and sometimes doing so without ever even viewing the home. Statistically, homes that sell within the first 7 days sell for closer to list price, at list price, and/or above list price more frequently than homes that have been on the market for 30, 45, or 60 days.
This used to be more of a normal practice but most markets have been so good for quite some time that buyers often shy away from making low offers. Furthermore, the price you set is your announcement that this is the price that you would like for your home. Some buyers just cannot be bothered dealing with an unrealistic seller and this can very easily be the perception that a home is overpriced. In our digital world, buyers have access to so much data. It is easy for them to quickly compare homes and determine in a few seconds that the price is off and/or at least think that the price is off.
Not at all! The goal is to sell your home, not hold on to it! A well-priced property in an active market should sell quickly and if there is pent-up demand for a home like yours, it could result in multiple offers. Market value is really no more or less than what a buyer is willing to pay for something.
This one kills me a little bit every time I hear it! Zillow data is interesting to follow but it is not something that we use when establishing true market value for a home. Zillow stats do not make adjustments for new kitchens, larger or smaller lots, location on a busier street, or supply and demand. When analyzing the accuracy of Zillow data in a Competitive Market Analysis, we often see these values fluctuating from being 30% below what a home sold for to 30% above what a home sold for. Zillow uses raw data and that will never replace the experience of a good broker. This may be why Zillow’s i-buying days came and went quickly and let’s not forget that they lost a ton of money in the process!
This is one of the biggest myths about pricing your home to sell. When it comes to wondering how much you can get for your home, the key factor is not what you paid or owe on it. Value has nothing to do with what you want to net on the sale of your home but rather is what a buyer is willing to pay.
Interested in market stats and homes that have recently sold in your neighborhood? Check out our Market Reports. From here you can select your specific neighborhood. Interested in a valuation of your home? We would love to connect.