How To Set My Home’s Selling Price
Whether you are a first-time seller or planning on moving into your 4th property, the selling price you choose is largely the most important decision you will make.While there are many factors that will allow your home sale to proceed, setting the right price is the same as making the right first impression when you meet someone for the first time. Buyers will choose by their budget which houses to put on their “to be considered list” above almost every other consideration.
Selling quickly and at the highest possible price are your goals. Negotiating for the best price is the buyer’s goal. It may seem to be contrary with price pitting sellers against buyers, but a proper market value price will allow everyone to win.
What To Consider When Setting Your Price
When you are setting your home’s selling price you need to be focused on what a buyer will see and appreciate about your home but the most important aspect of setting your price is how urgently you want to sell. A price set lower than current market prices will usually bring faster offers. You may even start a bidding war for your home and ultimately sell for much higher.
What May Not Affect Price
Your original purchase price
Emotional attachment to home
Improvements and enhancements
Insurance replacement value
Tax assessment value
Neighbour’s price suggestions
The hardest part of setting your home’s selling price is trying to avoid the emotional value you put on your home and looking at the possible profit you may make. Every home has its own unique personality and attraction qualities and what speaks to the owner may not impact the buyer at all.
You may have carefully selected the carpeting, hardwood flooring, and wall accents but the buyer may look at repainting, re-carpeting and making the home “their home” and by putting a price on the improvements you have made over time you may be setting the price too high.
Fair market value of your home is the pricing goal but ultimately the value is what a buyer will actually pay you for your home. Friends and neighbours may feel the need to inform you of their opinions about the price you should set, and they may even have examples to strengthen their comments, but as the saying goes “Money talks… everything else walks”.
Signs Your Home Is Priced Too High
Despite trending real estate market news not every home that is for sale falls within the definitions of market conditions known as a “buyer’s market” (an over-supply of homes for sale) and a “seller’s market” (a tight supply of homes for sale). Other conditions apply to the pricing of your home such as location, employment, transit and many more factors that come into play.
Comparable homes in the local area and at lower prices sell first
Fewer and fewer interested buyers over time
Future price reductions that later bring low-ball offers
A too-high (above market) price on your home can have many repercussions besides sitting on the market for an extended period of time and the listing becoming stale. These can include your own next purchase of a home not being able to be completed, additional financial expenses such as property taxes and extra mortgage payments, and even a potentially low-ball offer being presented and accepted as potential buyers become emboldened by the long listing period. Buyers may also incorrectly assume that there is something is wrong with your home because it is for sale for a long time and this type of negative impression is very hard to overcome.
Protect your finances and future stability by allowing an experienced real estate salesperson to help you set the right price for your home and the 80% of potential buyers that see your home in the first 6 weeks of the listing may be the only ones you need.
Additional Options To Attract Buyers
All other considerations aside, many home sales fall through because the buyer could not arrange the financing they need to complete the deal. While this is a set-back for everyone, it is not uncommon for the seller to have options available to the buyer to help the process become finalized as a sale. Based on your own financial position and the arrangements you can make with respect to the mortgage and deposit required, your help in the financial area of the transaction will certainly make your home much more attractive to a buyer.
If the buyer is a renter there is usually no issue surrounding the closing date and when the buyer takes possession of your home. If the buyer is also a homeowner and they need to sell their home before closing on yours, allowing flexibility in the closing date can make the transaction proceed smoothly.
An experienced World Class Realty Point real estate agent can advise you on current market conditions that will affect your home’s selling price and all of the complicated aspects of managing a successful and profitable home sale.
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