In our last blog post, Sarasota Property Finders' Pre-Listing Essentials, we talked about how to prepare your home before you put it on the market. The goal is to bring to light many positive aspects that you may not have considered, and to rediscover those attributes that led to your purchase of the home. The idea is that if you can appreciate all the positives about your home, it will be easy to convey these to the listing agent and the prospective buyer. But this exercise also helps you in one of the most important aspects of selling a home: pricing it.
Now that you have a good handle on your home's many selling points, we have a few more tips that will help you establish a price that's right:
Do your homework before setting the price
In a perfect world, you instantly hit an ideal target price that immediately brings about a sale while leaving you confident you got the maximum return. Often, though, the seller prices their home too high and the home ends up sitting on the market far longer than it should. A stale home looks less inviting to buyers who wonder why it's been on the market so long; more often than not the price is lowered considerably as the seller becomes desperate. Carefully researching that perfect price is the best way to get your home sold quickly and for the most money.
Focus on the immediate geographical area
Always keep in mind that housing markets are extremely local. The average price for a comparable home in your city may vary greatly from the average home price in your neighborhood. Make sure you are comparing apples to apples when looking at the prices of homes that have sold.
Choose a real estate agent that knows your neighborhood
An agent that specializes in your neighborhood is absolutely the most knowledgeable person when it comes to judging what your home will sell for. He or she is in the trenches every day, and is not only familiar with the sale prices of similar properties and transactions currently underway, but also knows the average buyer's profile and why people shop specifically in your neighborhood.
Be aware of trends
Current sale prices aren't enough to accurately set a price for your home. You're basically trying to hit a moving target. Make sure you know sale prices for similar homes as far back as a year ago. You may be able to identify a market trajectory that will help you price your home far more accurately and get it sold much quicker. You will also be able to identify seasonal trends, which could help you put your home on the market in time to catch a "buying season."
Once you have a good handle on your home's real market value and which way that market is headed, you can adjust your price to meet your goals. If you see that prices will most likely be going down, you can price your home lower than current market conditions to get it sold as soon as possible. Without knowing and responding to market trends, you may find yourself selling for that same price, only six months later than you would have had you priced it more aggressively. On the other side of the coin, if you priced a bit higher, you can be more confident that home prices will catch up and that you will not have to drastically reduce the price of your home just to keep the price competitive.
Know the market where you plan to buy
If you are planning on purchasing a home, follow the same steps above for the market where you plan to buy. If the home prices there are increasing much faster than local prices, it would behoove you to price your home so that it will sell quickly in order to be on the winning side of that equation.
Correctly pricing a home can be tricky business, but these tips and the guidance of a well-informed real estate agent can easily make the difference of thousands of dollars. If you are thinking of putting your home on the market, do as much homework as possible and educate yourself so that reality matches your expectations, and you come out the winner in what can be one of life's major challenges.
Sarasota Area Real Estate Specialist