Pricing your home to sell
Pricing your property realistically is one of the most important jobs for you and your Realtor®. Many people think that pricing a home higher than other homes in the neighborhood makes good sense. They rationalize that their house is worth more because of the custom items built into the home. Or they feel that they will negotiate downwards and therefore a higher initial price will result in a higher net.
Sometimes a real estate agent will inflate the price of the home to get the listing and later ask for a price reduction. It is to your benefit to understand just how the asking price of your home is determined, and you, the Seller, should participate in the process.
The first few weeks which your house is on the market are critical weeks. Generally if properties do not sell within the first 90 days in today’s market, it will take much longer to sell, and often, a price reduction will be in order. This results in a lower net to the seller.
Realtors® who show your home have a good idea of pricing in the neighborhood. The best comparisons come from properties within the same subdivision so homes being compared are “apples to apples and oranges to oranges”. If you do not live in a subdivision, the Realtor will use properties of like style, construction, use, size, and location.
Usually a smaller home will command a higher per square footage price than a larger home within the same subdivision. The kitchen and the bathrooms are the most expensive rooms in a home to build; regardless of size, all homes contain both. An addition of a fourth bedroom, a family room or bonus room, is basically an addition of walls which generate additional space in the home, but do not include plumbing, fixtures, or appliances.
The custom features of your home are very important to you, but may not be important to a buyer. A swimming pool does not add the value of its price to a property, and in some instances, will repel buyers. Buyers who understand the work involved with pool maintenance, or buyers with small children will often specify a property without a pool.
The beauty of landscaping with extensive gardens and a lush green lawn, might be seen by a potential buyer as work which eats up the weekends. In the southwest where water is an issue and xeriscape is in, a buyer may look at such a property as dollars to the local water company and opt for decorative rock instead.
Many factors go into pricing your property fairly including recent sales in the area, preferably within the last three months, the price of properties which are currently on the market, the amount of land, and the square footage of your home. It is often difficult for a seller to remove the emotion of “my home” from the pricing process. Ask your Realtor® to explain the pricing process, be prepared to sit back and listen, then think objectively, “If I were a buyer, what would be important to me?” Remember, your goal is to sell your home, and if your home is priced unrealistically, you may never sell it at all!