Selling a home is one of the biggest, most important decisions you can make in life. It involves a lot of investment – financially, mentally physically and emotionally. It can also feel like a giant mountain of a task, and you may have no idea where to start. But you’ve managed to do everything that’s required, put your house on the list and then what? You may not have to wait a long time for you to make a sale if you’ve done everything right, but if it’s been a while and you’re still struggling, then you need to go back to the drawing board and review everything.
The real estate industry may be extremely lucrative, thanks to virtual real estate viewings, but it is also a big gamble. More often than not, the one mistake that sticks out like a sore thumb is the pricing. Pricing your home correctly can be the single most important factor when you’re selling your house. No matter how perfect the house, it’s a big ‘NO’ if the price doesn’t line up with a buyer’s budget.
Real estate agents deal with this every day. Homeowners fantasize an ideal list price for their home even though it doesn’t align with the current real estate market. You don’t want to overprice the property because you’ll lose the freshness of the home’s appeal after the first two to three weeks of showings. Of course, there’s nothing stopping you from dropping your price later, but this can be a matter of too-little-too-late. Overpricing can tank your sale even in the hottest real estate market.
So, what is the best way to price your home right? Go into the process with a clear understanding of the factors that affect your home’s value. Let’s take a look.
- Assess Your Location
There’s more than one way to look at location when it comes to assessing its impact on house value. Your home’s proximity to amenities like schools, entertainment and good cafés and eateries can make it more desirable to buyers. Whether your home sits on a busy street corner or at the end of a quiet cul-de-sac can also raise or lower its value. But there’s more. Facts that affect your neighbourhood’s reputation, like economic and crime statistics, also need to be factored into your home’s value. The best agents also consider the larger market.
- Work with Your Agent
This is crucial. our agent brings the right mix of industry expertise and knowledge of your local market to the table. To understand whether your agent is pricing your home properly, you need to make sure that a good agent adheres to the following points:
- Listens to your needs
- Takes your research into account
- Uses his/her knowledge of the local market to help you pick the best asking price
Use what you learn about your home’s fair market price to evaluate any price your agent recommends. You’re a team. It’s in both of your interests to price your home correctly – a timely, profitable sale is a win for everyone.
- Leave Room for Negotiation
No seller wants to feel he left money on the table, and no buyer wants to overpay. Your price should give both parties room to manoeuvre, but if it is too high, you risk being perceived as unrealistic, and buyers will pass over your home.
- Appeal to the ‘Herd Mentality’
Given the high stakes of real estate, a buyer doesn’t want to be the only one interested in a house. By pricing your property on the lower end of the value range, you could stimulate interest among more than one buyer and create a herd mentality. Also, if you’re under the gun to sell quickly, this would be a good option.
- Understand What ‘Home Market Value’ Really Means
Many homeowners who are planning to put their house on the market think that their home’s market value is based on 3 things: their monthly mortgage payment, their opinion of how great their home is, the memories of their home. Here’s news for you – it is not. In a nutshell, market value is what buyers are willing to pay for your home. As a homeowner, it’s tough to see your home the way a buyer would. Keep in mind that a serious buyer will take critical mental note of the following:
- Curb appeal
- Square footage
- Number of rooms
- Updated appliances
- School district
The final price tag may also depend upon:
- Mortgage interest rates
- Time of the year
- Supply and demand
- How similar homes in the area have sold
Once you have factored in the above points and thought about them collectively, you will be able to set a good price for your home. One more thing you can do is opting for virtual property viewings and virtual open houses, which will give you more information on how the real estate market is faring and an insight into how other houses are selling as well.