Pricing Your Home
Your home is your most valuable asset. Besides being a place for you and your family to live, it is likely you have more money invested in your home than in your bank account, your business, or your retirement account. So when it comes time to sell, it is of utmost important that you get the best price the market will bear.
However, it’s also important not to price your home so high that it may discourage buyers or cause problems during the appraisal process.
So the first thing we need to consider when listing a home for sale is the price. It’s extremely important that we think about this step carefully, as everything we do from this point forward will be to JUSTIFY the price we have set.
In the Real Estate industry, we live and die best on Comparable Properties, or Comps for short. These are houses similar to yours that are in the same neighborhood. We use comps for everything from pricing the home for sellers, making offers for buyers, and appraisals for mortgage financing.
So there are a few approaches we can take to valuing your home. The first is looking for direct comps. Direct Comps are homes that are extremely similar or identical to yours. If you’re in a planned community with 4 or 5 different model lines of houses, look to see homes that are EXACTLY like yours that have sold within the last 6, 12, or 18 months.
If you can find three homes exactly like yours that have sold recently you should have a pretty good idea of the value of your home.
The second method we have to price the home is to look at Adjusted Comps. Here we compare homes that are reasonably similar but have some differences. Let’s say you have a ranch house in a particular neighborhood with 3 bedrooms and 2 bathrooms. Recently two ranch style homes sold. However, one of these homes had a pool and the other had 4 bedrooms. We have to assign a value to the features that those homes had and yours does not. From there, we can find an average value and adjust it accordingly to find a list price for your home.
Another option is to look at the average price per square foot. Look at some homes that have recently sold in your neighborhood. Add up the total sales prices from the three most recent sales, and divide it by the total square footage of those three homes. That should give you an average price per square foot. Once you have this value, multiply it by the total square footage of your home and you have the AVERAGE price your home could sell at. Now, from here, you need to decide if your home is average, below average, or above average and raise or lower the price accordingly.
The one thing we DON’T want to do when pricing a home is look at that evil Z word. Yes, I’m talking about the dreaded Zestimate. Homeowners love to go on Zillow and check on the “value” of their home, but be warned this number is in no way an accurate reflection of the value of your home. The average Zestimate is off by $14,000! And that’s just the average! So how is the average homeowner supposed to know the value of their home?
The best thing you can do to price your home is contact a real estate agent. They are experts in the pricing trends of your neighborhood and have access to data that you may not be able to access easily. In fact, I’d recommend getting a pricing opinion and a Comparative Market Analysis from several Real Estate Agents so you can get a feel for what your home is worth. Agents won’t charge you for this, as it’s their opportunity to pitch you to list your house.
I personally believe in a pricing strategy that is aggressive but realistic. I have been in Real Estate for years and I’ve never had a listing not sell. In fact, I’ve been on listing appointments and been told by homeowners that I was pricing their home way too high. Imagine their surprise when I got them a full price offer on their second day on the market!
The reason I’m able to price houses so high and get sellers their price is what this website is all about. All of the tips and tricks in this site are designed to justify your price and help you get the most money for your home. That way you can move on to your next home without leaving any money on the table.
If you’re ready to find out what your home is worth call, text, or email Stephen Dispensa of Real Broker LLC. and Tampa Real Estate Secrets and I’d be happy to present you with a free pricing analysis of your home.
Licensed Real Estate Sales Associate
Real Broker, LLC.
Tampa Real Estate Secrets