How to Pick the Right Selling Price for Your Home
Guesy Post: Erica McAvoy, REALTOR® at Coldwell Banker Hubbell BriarWood
Posted: September 04, 2020 by Matthew Hillier
Pricing your home correctly can be the single most important factor when you're selling your house. Set the number too high and your home could languish on the market. Too low, and you risk leaving money on the table. No pressure, right?
Luckily, you don’t have to come up with that magic number on your own. By leaning on the experts and educating yourself on the process, you’ll have more confidence when it’s time to pick that right price. Here are some tips to help you on your way.
Try To Keep Emotions Out Of It
We all think our house is the best one on the block. But the truth is, no matter how much you originally paid for it or how much money you put into it, your home’s value is simply what a buyer is willing to pay for it today.
REALTOR® Erica McAvoy with Coldwell Banker Hubbell BriarWood Realty says she often talks with clients about emotional value vs. market value.
“Sometimes sellers are so emotionally invested in their homes, that they forget it’s a commodity being sold,” she said. “They think about all the time and money they put into renovations and upgrades, and while those improvements may increase the home’s marketability, they don’t always translate into monetary gains.”
Surveys by the National Association of REALTORS® show that your return on investment for home improvements depends not only on the type of renovation, but also how much prospective buyers in your area value that feature. For instance, NAR’s 2019 Remodeling Impact Report found that refinishing hardwood floors can provide a 100 percent return on investment, while a complete kitchen renovation only yields a 59 percent return.
Do Your Own Research But Proceed With Caution
More than 90% of buyers start their home search online, so it’s no surprise that sellers turn to the internet for guidance as well.
But when browsing the internet, remember that not all sites are created equal. Some property sites aggregate listings from Multiple Listing Services (MLS) around the country, while others collect listing information from a variety of sources, which may not be as up to date as the MLS.
Sellers touring property sites may also run across online home price calculators, which use sale prices near you and overall market data to approximately predict your home’s value.
Turn To The Experts For Local Market Knowledge
Once you’ve done some research, you’re off to a great start. But, to truly nail down that perfect price, you need professional guidance.
“Real estate markets vary across the country and everything comes down to what’s happening in your local market,” said McAvoy. “An area REALTOR® provides things the internet just can’t, including real world community experience, an understanding of neighborhood nuances, and in-depth local market knowledge.”
A REALTOR® will put together a comparative market analysis in which they look at comparable properties in your neighborhood — those that are currently listed and recently sold, and those that failed to sell and were taken off the market. Your agent reviews this data along with other factors, including interest rates, the current economy, seller needs, time of year, etc., and assess everything in order to determine a value range for your home.
“Without having a local expert physically tour your home, it’s really difficult to come up with an accurate price,” said McAvoy. “When sellers base their strategy on the internet alone, I typically find they’re either overzealous or selling themselves short.”
And while you may believe you can save money by selling your home yourself, make sure you check the stats before going it alone. According to NAR’s 2019 Profile of Home Buyers and Sellers, For-Sale-By-Owner (FSBO) homes sold at a median of $200,000, which was signi?cantly lower than the median of agent-assisted homes at $280,000.
McAvoy says in today’s market, it’s more important than ever to have professional representation.
“The dynamics today are very different than in years past — we are dealing with the national impact of COVID, interest rates are at historic lows, and we have a lot of pent-up buyer demand with very little inventory available,” she said. “It’s an extremely competitive market, and a good time to sell, but you have to nail your pricing strategy. To do that successfully, it’s critical that you partner with a local, experienced REALTOR®.”
Original blog can be found on: lansingstatejournal.com