Smart sellers know that crunching the numbers is always the better route to an accurate home price. Here’s how they do it.
#1 They Avoid OverpricingHomeowners often think that it’s OK to overprice at first, because — who knows? — maybe you’ll just get what you’re asking for or we can always come down in price.. Although you can certainly lower an inflated price later, you’ll sacrifice a lot in the process due to shifting in the market and losing opportunities with buyers in the market place.
A house that remains on the market for months can prevent you from moving into your dream home. Already purchased that next home? You might put yourself with two mortgages.
You lose a lot of time and money if you don’t price it right and Continually lowering the price could turn off potential buyers who might start wondering just what is wrong with your home.
Buyers have access to unlimited tools and resources and todays buyers are more educated than ever. They research homes, check public records and factor in a property's history in the process of making an offer. Pricing your home correctly will lead to a quicker sale and more money in your pockets.
#2 They Don't Expect Dollar-for-Dollar ReturnsIt’s easy for homeowners to stumble into two common traps:
Many homeowners think, ‘Of course my home is worth a bazillion dollars. If they put in a few thousand dollars worth of new flooring, for example, they might overestimate the upgrade’s impact on the home’s value into the tens of thousands.
That’s not to say that renovations aren’t worth it. You want to enjoy your home while you’re in it, right? Smart renovations make your home more comfortable and functional but should typically reflect the neighborhood. A REALTOR® can help you understand what certain upgrades can recoup when you sell and which appeal to buyers.
Another culprit for many a mispriced home is online tools, like Zillow’s “Zestimate,” that prescribe an estimated market value based on local data.The estimate is often wildly inaccurate.
If you are considering making improvements in order to sell your home, discuss them with your agent. An agent who is knowledgeable in the market, buyers needs and wants and what buyers are expecting in your area and neighborhood, will be able to guide you any improvements needed and which will bring the highest return and get your home in the best condition for a quicker sale.
#3 They Use Comparable Sales (also Known as "Comps")The best pricing strategy? Consult a real estate agent, who will use something called comps (also known as “comparable sales”) to determine the appropriate listing price. They’re not just looking at your neighbors; they’re seeking out near-identical homes with similar floor plans, square footage, and amenities that sold in the last few months.
Once they’ve assembled a list of similar homes (and the real prices buyers paid), they can make an accurate estimate of what you can expect to receive for your home. If a three-bedroom bungalow with granite countertops and a walk-out basement down the block sold for $359,000, expecting more from your own three-bedroom bungalow with granite countertops and a walk-out basement is a pipe dream.
After crunching the data, they’ll work with you to determine a fair price that’ll entice buyers. The number might be less than you hope and expect, but listing your home correctly — not idealistically — is a sure way to avoid the aches and pains of a long, drawn-out listing that just won’t sell.
#4 They Adjust the Price When NeededOnce your home is on the market, you’ll start accumulating another set of data that will serve as the ultimate price test: how buyers react.
If we have no showings, it’s way too high. Lots of showings and no offer means you’ve marketed well — but it’s overpriced once people get inside. Analyzing the activity on your home, feedback, online reports and buyers activity will help ensure that your home is positioned in the market to achieve the result of getting it sold.
When it comes to finding a buyer, pricing your home according to data — and the right data, at that — is crucial to making the sale.