Sunday, January 13, 2019 / by Mandee Sears
Buyers think of value, but are more concerned with price. Your home’s price is one of its most attractive — or unattractive — features. The right price can attract buyers, quickly. The wrong price could mean the house sits on the market, which can create the thought among buyers and agents that there’s something wrong with it.
To price your home right the first time, consider the following lessons:
Value vs Market ValueYour home has value, no doubt. The Market Value is the price a buyer is willing to pay for your home. It's calculated by looking at the recent sold, comparable homes in your area. This is how an appraiser will report the market value of a property to the mortgage lender when a buyer is applying for a loan.
Then, there is emotional value. This value is very personal - it's memories, it's nostalgia, it's sentiment, it's pride. It is very real to the seller but not so much to potential buyers.
These two values are typically not in alignment. Would-be buyers don't have the memories or attachments to the property the sellers do so it doesn't affect the price they are willing to pay.
Lesson #1: While it can be extremely difficult, in order to price your home right the first time, you have to set aside your emotions and look at the data. It'll make it easier to accept the price your agent's realistic, logical research has determined.
Understanding the Local, Current MarketIn a Seller's Market, the demand for homes outpaces the number of homes for sale. In a Buyer's Market, the number of homes for sale outpaces the demand from buyers. Then, there is a Neutral Market where demand and inventory are close to equal.
The type of market the area is currently experiencing also comes into play when pricing your home.
We are on the downturn of a Seller's Market, slowly approaching a Neutral Market. This means the demand for homes is still there from buyers but not enough inventory to go around - but it's changing, slowly.
In a Seller's Market, it is still very important to price your home right. Buyers and Agents today have more data and resources at the fingertips than ever before. They can calculate the market value of your home, just as you and your agent can. Being savvy, the majority are still not going to pay more than market value for your home.
Lesson #2: Keeping this in mind, sellers who price their homes at or a smidge below market value are more likely to get offers fast! They may also trigger a "bidding war" and end up with an accepted offer above market value. Wouldn't that be fantastic!
Bottom LinePricing your home for the current market is an art and science. Having a professional in your corner can make all the difference in the activity, time on the market and the price you ultimately accept!
The Real Estate Pros of Keller Williams Listing Specialists know the market and how to price your home. Avoid languishing on the market because you have overpriced or selling for below value by calling us today for a FREE Consultation! 317-572-5589!