Pricing can be most hustling thing we may experience throughout the process of selling homes. To find the most appropriate pricing for your place is essential to to deal. High prices can scare off the buyers, where as low prices can cost you profit. Hence here are 3 things you might want to consider when you are trying to list price. Hopefully they can make the process easier for you.
1. The most important thing when evaluate your home is to compare against already sold places that are similar to your own home. (Also known as comparable homes).
Even though this method can be one of the most apparent and simple way to price, it is reasonable that sometimes we may think our home is worth more than the neighbors’. I’ve often heard reasons like: I’ve installed hunter Douglas auto blinds. I’ve replaced all my appliances with luxury brands. I’ve installed brand new flooring…..We believe the investment we had made on our home would bring up the value. But this only applies if those investments is appreciated by the appraiser or the buyer.
So how do appraisers evaluate a home? They collect comparable homes that have the same number of bedrooms and bathrooms, approximate square footage, and age as yours in the area (usually within 0.8 miles) that were sold within the past 6 months. Using this information as benchmark, they will then make some adjustment based on additional information they could find, like parking spacing, storage, condition, New York /River / park view and etc. So if you live in a condo building, your neighbor upstairs who had the same layout as yours sold their place a few months ago. Now you want to sell yours 10% higher than their price. It can take a lot efforts to make a case for the appraisal.
2. Knowing your buyers and understand their preferences is also essential. For example, when I sell condos in newly developed areas, I tend to emphasize on the condition of the home with my sellers. Sometimes it is hard for owners to see it objectively. we are so used to focus on the functionality but neglect the cometic things.
During my work with buyers, I have seen them constantly comparing what they have seen against brand new constructions in the neighborhood, even though they have the price difference in mind. My buyers would stare at a few scratches on the wood flooring and tell me they worry about the condition of the place, and they plan to replace the floor before they move in. In this scenario, I would advise my seller to replace the flooring before list it to the market.
3.Understand the inventory. Thinking from the buyers’ perspective, after starting the home purchase process, they would set up criteria and timeline for home shopping. Often they may have a lease expiring, and need to move out by a certain date. They don’t have unlimited time to shop, so they would spend a month or two touring most of the homes in the market and make a decision based on what they have visited.
Maybe your place have some unique selling points and there are very few places similar to yours in the market for sale. Then the buyers will have no choice but paying a little more to get their dream home.
For example, when I was listing a place for sale that is a rare to find home in that market, I knew that this home could get a better deal than what the comps suggest. So I informed the seller and listed 11% higher than the last comparable and sold it very close to asking.
To find the perfect list price for your home, contact me for a free evaluation.
