The truth is, it doesn’t really matter how much money you think your home is worth. Nor does it matter what we, or any other agent, thinks your home is worth. The person whose opinion matters most is the buyer who makes the offer. Pricing homes is part science, part art. It involves comparing similar properties (comps), making adjustments for the differences, and factoring in the current market trends and inventory. As in the stock market, auctions, and Ebay, the market will ultimately end up dictating the price. All we have to offer is an educated opinion.
So here’s our opinion.
- Get good comps.
Comparing properties in our area can be challenging. Seldom are there neighborhoods where every house and lot size are exactly the same. Your agent should know that in our area, old wideboard floors are more desireable than brand new floors. Dutchess County may often support higher prices than the same house just 10 miles away in Columbia County or across the river in Greene County. A one-of-a-kind antique gem can bring higher prices than ever expected. Experience and knowledge are critical here.
- Price your house competitively.
The best way to find the right buyer is to bring in as much traffic as possible. Overpricing doesn’t give you a negoitiating cushion as many think. It turns off potential and knowledgeable buyers who don’t even come to view your house. In our present market, buyers can afford to be more choosy. Put your house on their must-see list.
- Don’t base the price of your house on your neighbor’s asking price.
What other people are asking, isn’t necessarily what they’re getting. Pay attention to how long your neighbor’s house is on the market.
- You can’t underprice a house.
If a home is priced slightly under the competition, people notice, and the seller should receive multiple offers that drive the price up to, and in some cases, over asking price. In fact, some sellers have purposely underpriced their house to create this kind of bidding excitement.
- You can overprice a house.
Here’s the scenario: A home is priced too high. Educated buyers move on to other properties. The house misses its window of excitement that brings in the high traffic. Time passes and the home is still on the market. People start to wonder what’s wrong with the house. There are multiple price reductions. More time passes. The house is now suffering from “listing fatigue”. Months later, frustrated sellers may actually end up taking a lower price than if they’d priced the house properly at the outset.
- Don’t automatically choose the agent who suggests the highest list price.
Uninformed agents may not be aware of market changes. Unprincipled agents may play on the sellers hopes just to obtain the listing, and ask for a price reduction soon after they have the listing. While the high list price suggested may very well be the proper asking price, it’s wise to ask the agent how they arrived at the price they’re suggesting. They should be able to show you recent comps that support it.