You fixed up your house, found a Realtor, and you are now ready to make the move. But, what about pricing your home? Pricing your home properly is the number one thing that will determine how quickly you get an offer. In this instance, it's extremely important to heed your Realtor’s advice. You have hired them for their expertise and this is where they will shine.
Here are the top mistakes sellers make in pricing their home for sale.
- Pricing a home based on what's currently for sale in the area and not on what's been sold locally.
In preparing your home to list, your Realtor will do a Comparative Market Analysis. (CMA) This basically gives you an idea how your home amenities, size and condition compare to others around you. The CMA will be based on recently sold homes as well as homes currently for sale. It is important to see what similar homes sell for. Remember- a home will only sell for as much as similar homes sold for.
- Pricing on what you WANT to get for the home.
Yes, we know that you might still owe $100,000 on your home. But, again, (See #1) the home will only sell for what it is worth. It’s worth what someone will pay compared to other homes around yours. Try not to set your sights on a specific dollar amount until you have all the facts from your Realtor in front of you in order to make an educated decision.
- Expecting to get full value for improvements made.
Many people add on to their home, re-do their kitchen or finish a basement expecting to get 100% of that money back when they sell the home. While that thinking is not completely realistic, keep in mind that kitchens and baths do tend to get the best return on investment. Improving your home will definitely do is make it more marketable and most likely enable it to sell faster (and at a slightly higher price) than a home without those improvements. Remember, if you are planning renovations, be sure you don’t exceed the ceiling for your neighborhood.
- Over-estimating the value of amenities.
Having a handicap toilet, convection oven, Jacuzzi tub and built in surround sound is great for YOU. But, if someone else really doesn’t care about those things, they do nothing to add to the value of the home. If a person could care less about cooking, they are not going to pay more for a home with a convection or gourmet oven. Swimming pools are also a great example of this.Though a costly addition, in many cases, a swimming pool can actually hurt the sale of your home. When you add a personal amenity to your home, you need to do so with the realization that this is JUST for your enjoyment and not for someone else. What is important to you, is not necessarily what’s important to the rest of the world.
- Taking too much stock in an online valuation.
Yes, we know what “that website” said your home is worth. Some buyers are also looking at these numbers. With that in mind, if possible, an ideal situation is for your asking price to be below the on-line value. Sometimes you can boost your on-line value by “claiming” your home and updating any incorrect or missing information. This can increase the on-line valuation within a few days.
- Not monitoring activity after the listing goes up.
Once your home goes on the market, it’s important to monitor the activity. The first two weeks on the market are pivotal to seeing if you have the home priced right. Pay attention to feedback from anyone that goes through the home and does not make an offer. Those are the people with nothing to lose by telling you what you may not want to hear. If your home doesn’t receive any offers in the first couple weeks, don’t be surprised if your Realtor wants to discuss lowering the price.
As the homeowner, you are the boss. But remember, you hired your Realtor to be the voice of experience and reason. If you decide to overprice your home and it is still on the market months later, it's certainly not fair to blame the realtor who advised you to list at a lower price in the first place. Starting at the right price when your home is first listed is a great way to kick off a smooth and quick home sale transaction.
Are you looking to buy or sell a North Shore home? If you have any real estate questions or needs, feel free to contact me. I’d be happy to help.
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