Three Simple Tips to Follow When Pricing a Home for Sale
One of the hardest parts of selling a property is determining how to price their home. While a real estate professional may be able to give you advice, we recommend following these three tips. At Neighborhood Escrow we have worked on many home sales and are ready to help you through yours 310-378-2456.
- Use an Online Price Estimator
- Look at Comparisons
- Start Out Pricing the Home Below Market Value
In this day and age, there are many online price estimators, from Zillow to Redfin. While you do not want to take any of these as Gospel, it is worth looking to see what they are listed at. These estimators consider property records, info on the neighborhood, and details of a home to determine a fair price. They have been shown to have a margin of error lower than 2%.
While the online price estimators can be useful, they do not tell the full story. For example, if you take the time to makeover your entire kitchen and add brand-new appliances, this likely increases the value to a buyer. However, this would not be shown on a price estimator. To determine the increase in price for things like this, you would need to compare your home to others in the neighborhood.
Look for other homes with similar square footage, the same number of bedrooms, and the same number of bathrooms. Compare the size of the plots they are on and look for a home with the same updates you have made. We recommend looking for at least five properties that have recently sold that meet your criteria. Then determine how they were priced and what price they sold at to get a good idea of how to price your home.
This may seem counterintuitive – why would you want to sell a property for less than the home is worth? The answer is simple: You don’t. If the home you are selling is in a highly sought after neighborhood, pricing it below market value is a great way to encourage as many people as possible to notice the property and take note. You will likely find many people bidding on it and the price can shoot up much higher than if you had priced it correctly originally.
Why? Because buyers are competitive. Once they get in the door and determine they want the hose, they may do anything necessary to get the home they want. One study showed that homes priced either at or below their market sold for 7% more than houses that were priced above market value when entering the market.
There are many decisions to make when selling your home but hopefully you will have the right professionals on your side to make the process as simple as possible.
