When you’re selling a house, the asking price can be one of the biggest factors in how fast your home sells and how much you get for it. Price it too high, and you’ll turn buyers off. Price it too low, and you’ll take a hit on profits. A low price will also turn off buyers who wonder what’s wrong with the house to make you price it so low. Real estate agents use a number of metrics to decide on the best asking price for the homes they represent, but if you’re selling on your own, you may not have access to the same resources that an agent does. Here are some tips on setting the right asking price for your house for sale.
Check Out Recent Sales in Your Area
Your house may be stunning and in top condition, but if your neighborhood is in a pricing slump, it’s going to affect your home’s sales price. The starting point for setting your real estate asking price is the selling price of homes that have sold recently in your neighborhood. Look for homes similar to yours that have sold within a few blocks or miles as your own home. They’ll give you a feeling for the general market value of homes in your area.
Where to find recent sales statistics: Your real estate agent will have easy access to recent sales statistics, but it may be a little trickier for you to access them. There are, however, a lot of realty websites that list recently sold homes by zip code. You can check the days on market and selling price and compare them to the price you want to get.
Don’t Mix Up Active Listings with Past Sales
Don’t make the mistake of equating active sales listings with selling prices – those are “wish” prices, what other sellers in your area hope to get for their properties. By all means, take a look at what your competition is asking for their homes, and set your price competitively.
Don’t Overprice
A common bit of advice is to set your real estate asking price low if you want to sell your home fast. This is generally good advice, but the opposite advice is not necessarily true. Even if you’re not in a hurry to sell your home, setting your asking price high can cost you in the long run. If the home prices in your area are dropping, you could find yourself dropping the price time and again. If prices are stable, your house could just sit there while other similar homes around you sell quickly. If you’re not in a hurry to sell and the market doesn’t support the price you want for your home, wait to list it until market conditions are more favorable. You’ll be more likely to get the price you want in a better market.
Don’t Underprice
Setting your asking price too low can backfire on you in unexpected ways. Many buyers will pass it by – or never even see it, especially in these days when people often search online for homes for sale by price range. If you price your home too far under the market pricing for similar houses, your listing may be completely missed by potential buyers who are looking for homes in a specific price range. You may also be overlooked by buyers who will simply assume that you must be hiding something very wrong with your house if you’re willing to accept that low a price.
Leave Room for Negotiation
By the same token, don’t set your rock-bottom price as your asking price. Leave yourself some wiggle room to negotiate so that you and the buyer can reach a price that works for both of you.
Consider Features When Pricing Your Home
When figuring out how your home compares with others in your area, be sure to consider features that are important to buyers. Is your home the same size and in a similar location to another, but yours offers an enormous front yard? That’s something most buyers consider important, so you can scale your price a bit higher than the norm. Other factors that you may consider include home fixtures (updated carpeting, granite countertops, new appliances), situation (great view vs. facing the interstate) and finished basements, attics and other property upgrades.
React Quickly to Feedback
If you get feedback from prospective buyers or your real estate agent that your house is priced too high, don’t hesitate to adjust the price. If you don’t start getting nibbles when your home for sale first goes on the market, waiting a few weeks to see how things shake out isn’t likely to make things any better.
The asking price for your home for sale is one of the most significant factors affecting how quickly and for how much your home sells. Getting it right is important, so take the time to research home prices and, if possible, get a professional to give you a reasonable value assessment.