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What is Your Home Worth in Today’s Market?
November 5th, 2007 categories: About Realtors, Columbus, Local Communities, Real Estate Professionals
Whatever the market conditions at a given time in a certain area, Home Sellers (or those considering selling) always have to address the age old question of how to price their home.
Realtors, friends and neighbors, family and maybe even the mailman weigh in on what the right price is to affect a sale. I have a secret for you……None of these people determine the selling price for your home, it is always determined by a ready, willing and able Buyer.
Below are a few factors Sellers often consider which have little or no bearing on the ultimate sale price.
- What they paid for their home
- The cost to rebuild their home today
- What they would like to net from the sale of their home
- What they need to be able to afford their new home
- What they need to recover the cost of renovations and improvements
- What their friend, neighbor or co-worker says their home is worth
When we as Realtors assist Sellers with pricing a home we rely on data generated through a Comparative Market Analysis(CMA). A CMA uses recent sales, homes currently for sale, homes in contract or pending sale, and homes which were on the market but failed to sell. Especially during a shifting market, it is critical that the most recent data available is used to establish a pricing strategy.
In my opinion, a Realtor’s job is to properly educate Sellers such that they can price their home properly given current market conditions. We as Real Estate Professionals help analyze the data and pinpoint trends and strategies. Choosing the price is up to the Seller.
Never choose a Realtor based on the list price they suggest as they have little control over the final sale price. A good Realtor will always decline an overpriced listing knowing it is in no one’s best interest to waste time and money chasing unrealistic expectations. Choose a Realtor with experience, a system for getting your home sold, and an approach and personality you feel will best represent your objectives.
A few pitfalls to avoid include:
- Pricing with “room for negotiation”
- Setting the price high because “we can always come down”
- Ignoring deferred maintenance or needed upgrades which impact sale price
It is normal that we are proud of our homes, have a financial and emotional investment in them, and see them as desirable. It is important, however, when selling that we take a step back and really look at the situation objectively through a Buyer’s eyes.
Especially in today’s market:
- Get input from a professional on pricing strategies
- Make sure your home is in top showing condition
- Get moving!
Related must reads: Photos to Sell Your Home, Do You Really Want to Sell?
[…] It is time for sellers to get realistic, and we as real estate professionals need to be telling our sellers the truth about the market. Eric and Nikki air The Real Estate Laundry to give home sellers the truth about what their home is worth. […]
Hi Eric and Nikki,
This is a great article. Your explanation of the CMA is very clear. This is a great myth busting list of pricing considerations often used by sellers. You did leave one important one out, though. How about appraisals. Most sellers don’t understand how appraisals work, how appraisers receive their instructions, or how time specific appraisals are. This is a key educational item, especially where some prices are adjusting downward. Thanks for the great article.
[…] your expectations, the time it may take to sell and the amount you may settle on. Check out What is your Home worth in today’s market? and What to do if you really want to sell your home for more information and contact us if you have […]