#PRICING Price the home correctly! Research show’s overpricing your property will actually cost you money. If priced competitively from the very beginning, a home will sell at the higher end of the value range. The longer it lingers on the market, the lower it lands in that range. To understand pricing, first, you must understand that homes sell in ranges. Depending on a number of factors. First, you must understand what a comparable home is. When looking at comparables you will only look at the most like kind home. For example, you compare two-stories homes ONLY to two-stories. Homes with pools to homes with pools, try to keep sales within 3 to six months, and square footage variance within 10% or 15% and keep it within a mile (idealistically). Depending on the turnover rate of the neighborhood, the more details you add the fewer homes you may have to pool from.
Secondly, when was the last time you last updated the home? Which interior design trend does your home remodel follow? what upgrades and features does your home have? What condition is it in will dictate where in that neighborhood range it falls.
Finally, understanding days on market of those sales. Are homes sitting on the market in the neighborhood more than other areas? (meaning there is less demand)? Once you have all these factors calculated you can narrow that range of value.
Overpricing a home may have worked in the past. But it absolutely will not work in today’s market. Here’s why it worked in the past. Lack of information (mic drop).
Historically, 20+ years ago, realtors were the only ones that had access to see these homes. There were not a lot of pictures, access to the homes was harder, there was less awareness. But in today’s technology era where everyone knows the household names of Zillow, realtor.com, or Trulia there is more information on sold properties, and abundance of pictures, and historical data. Consumers have become equipped to better understand value, and are more judgemental of the condition of your home. The process of selling your home can feel like a roller coaster with emotions. Overpricing your home will only enhance those high’s and lows.
Here are my Top 5 Reason’s you shouldn’t overprice your home:
- It won’t sell!
- Higher chance of Buyer Canceling
- Low Offers/Time
- Appraisal Issues
- Cost: You can actually lose money and cost you more with interest rates rising, appreciation rates go up, additional mortgage payments
If priced competitively from the very beginning, a home will sell at the higher end of the value range. The longer it lingers, the lower it lands in that range.
