Getting the Price Right
When selling a home, one of the most important decisions a homeowner makes is their initial asking price. Pricing real estate is part art, part science.
Real estate agents have training in the pricing of a home, and have access to MLS data that allow them to analyze comparable sales. Home sellers typically consult real estate agents on the price to set for their home.
There are several components - as well as pitfalls to avoid - in pricing a home. However, you should remember that getting your price right is completely feasible.Several factors need to be taken into account including:
- Historical sales of comparable homes: Recent home sales in the area provide one of the best indicators of the value of a home. It’s important, however, to choose the right comparable properties in the analysis and to account for differences in home features. As previously mentioned, real estate agents have access to this type of information and can provide you with a comparative market analysis (or CMA).
- The seller’s appetite for risk: Home sellers face a similar set of choices in pricing their home. Price too high and the home may sit on the market too long, price too low and the home may sell for less than it’s worth. However, home sellers differ considerably in their appetite for risk and the speed at which they need to sell. Do you need to move into a new home quickly and are your mortgage payments high? Do you need to cash out as soon as possible for financial reasons? Or are you only going to sell once you get a strong offer on your property? These are questions you need to consider in deciding on a price.
- Local economic and demographic trends: What has happened in the local economy that may affect your sales price? Are unemployment percentages increasing, decreasing or flat? Has your neighborhood become a hot place to live because of schools, proximity to places of interest, etc.?
- Local real estate price trends: What are recent trends in home prices in your neighborhood and town? Comparable sales data should be analyzed – but price trends should be taken into account as well.
When your home first goes on the market, you will typically get your highest number of showings. If your home is priced too high, buyers are unlikely to make decent offers. Are if you later drop your price, you are unlikely to regain that initial flurry of activity you had when your home first went on the market. Furthermore, your price drop may impact your negotiating leverage. All that being said, you don’t want to let the prospect of a potential price decrease scare you into asking too little for your home.
You can determine the best price possible for your home. It just takes some careful analysis, consultation with an experienced real estate agent or appraiser, and a little gut checking.
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If you’re looking to sell Lake Norman or Charlotte, NC real estate, then we can help. We serve towns such as Charlotte, Mooresville, Cornelius, Davidson, Huntersville, Concord, Denver, Kannapolis, Statesville and surrounding areas.