PRICING YOUR HOME RIGHT MAKES A BIG DIFFERENCE

We all want to get the highest price possible for our homes. But when it comes to pricing your home, there are a lot of things to consider. Pricing your home right – or pricing it to sell immediately – makes a big difference.

A home’s price is one of the most important factors in determining whether or not it will sell. And pricing your home correctly can be the difference between a quick sale and a long, drawn-out process. Homeowners who think they may be ready to sell their homes are often unsure how to price their homes in a way that will make them the most money. Even though there’s a big buyer demand for homes in today’s low inventory market, it doesn’t mean you should price your home as high as the sky when you’re ready to sell. Here’s why making sure you price it right is key to driving the best price for the sale.

The home selling process is a lot like playing “The Price Is Right”. If you want to win, you have to be the one who guesses the value of your home just slightly under market value. The problem is that many sellers think if they set their price too low, they’ll get stuck with it. So they price it as high as they can, hoping the bidding will go up and they’ll recoup some of the money they spent on their upgrades. But when you overprice your home, buyers are going to walk away. That’s because in today’s market there are many qualified buyers who will outbid someone else who offers less money for another home. Or you may see agents showing your home in order to sell another property, because they want to show the buyers the 'steal of the day' next door that has the same features for slightly less money.

When you underprice your home and put it on the market, you can sometimes run into a different problem: Buyers may think something is wrong with your home because of the low price if it's too low. Buyers may assume this, and they'll try to get it for even less.

In a super low inventory market, like what we have now, if you price it just slightly below the market value, you may conversely see that you get lots of lookers and multiple offers. In a low inventory market, with a lot of qualified buyers, this could lead to multiple offers. We'll talk about this more below.

Remember that the best way to sell your home quickly is to price it right. While in the past it was a common practice to price your home as high as you could and then negotiate down, today’s market conditions don’t support this strategy.

In fact, pricing your home too high can actually hurt your chances of selling it quickly. So how do you know how much to ask for?  What can you do about it? 

It depends on a number of factors: Your home’s condition and upgrades; comparable sold prices; and local inventory and competition. If you aren’t sure what to ask for when it comes time to list your home, here’s what you need to do: 

First, if you’re not using a real estate professional to represent you, make sure that you are aware of the latest trends in pricing and how they apply to inventory levels in your area.  Second, keep up on the market in your area – talk to other homeowners and be sure to check recently sold homes that have come onto the market. It makes sense to price your property right the first time because timing is everything once an offer has been made.  And finally, trust your intuition when setting your asking price – it’s not always easy to understand what things will sell for, but sometimes a gut instinct is all it takes.

Pricing it right also might lead to multiple offers, which can help drive up the final sale price you get for your home. In a tight inventory market, listing at a price that will entice buyers can often bring you the market value or more. Even when inventory is tight, pricing it right – or pricing it to sell immediately – makes a big difference.

If you're thinking about selling and would like some help determining what's right for your home, feel free to contact us directly. We’re happy to help!