The Art of Pricing Your Home to Sell
Determining the right price for your home is complicated. It’s a balancing act. You don’t want to price so low that you are leaving money on the table, but you can’t go so high that would-be buyers are turned off. Pricing your home is part art, part science, and part psychology. It is also the most important part of the entire sales process.
If you get it right, your home will sell quickly at a price that pleases you. But an overpriced home may cause buyers to simply wait till you lower the price or worse — they will move on quickly. Remember, the list price of your home is not necessarily the sale price. The list price of your home is designed to generate showings, and produce offers. It usually takes into account some negotiation.
The critical time to attract buyers is the first 2-3 weeks of listing your property. If buyers perceive good value, you may receive multiple offers. If your house is not well-priced, you will lose showings.
So, how to master the art of pricing our home? Here are five strategies you may find helpful:
- Price your home based on facts not emotion. Don’t assume that the buyer is willing to pay a premium for your years of happy memories. Do not compare the price of your house with a price your neighbor got a few years ago. Markets change quickly by season and by year. Buyers are able to do their own research, and decide how much your home is worth by deciding what they’re willing to pay for it.
- Determine the appraisal value. The most valuable marker for the price of your home is the appraisal value. A lender will set the appraisal value based on comparable sales within the last 6 to 12 months within a half a mile to mile radius. This will give you a valuable indicator of the value of your own home.
- Package your home for sale. Your pool of buyers today may be very different from the buyer pool you were in when you bought your home. Today’s new young buyers, for example, are HGTV-savvy and have different expectations. So, be prepared to take your agent’s advice. They usually recommend that you bring your home into the best possible marketable shape by renovating, repairing, decluttering, and upgrading. The size, condition, and finishes will all influence the pricing.
- Make it easy for buyers to make an offer. Sellers wonder why buyers don’t simply “make an offer.” Psychologically, if buyers feel the asking price is too far removed from what they are willing to pay they often do not want to insult the seller with a low-ball offer. They can also be reluctant to engage in a long and difficult negotiation process with a seller they perceive as being unrealistic and unmotivated. Buyers always have an eye on future resale and do not want to feel they overpaid. Pricing slightly below your competition can make your home stand out from the noise and reduce your days on market.
- Don’t go at it alone. Bring in the professionals! Hire an outstanding local agent whose full-time job it is to track and analyze the market. The price you may want for your home has nothing to do with what it is actually worth on the open market. Your realtor is on your team! She is your best advocate. She will perform up-to-date quantitative analysis in order to make a realistic pricing recommendation to sell your home quickly for the best possible price.
Call Fiona Dogan at 914-414-5147 for more information on pricing or selling your home!