5 Steps for Setting the Right Listing Price 1. Apples to Apples Analyzing the comps entails some detective work. Obviously, your house isn’t exactly like every other on the block. It can be far better – or far worse. Here are the factors that are considered for comparisons: Square footage: This is significant for most buyers. Some will even hunt based on square footage alone. Usually when it comes to pricing, the bigger the property the bigger the price tag to offer, however, some properties have proven this myth wrong. (REOs, Short Sales, and un-kept homes). Age and condition: Newer homes don’t necessarily command higher prices, or vice versa, but condition relative to age does factor into price. So when comparing your home to others, stay within a five-year range. Number of bedrooms and baths: How many your home has can radically change the price. Amenities: The more perks, like walk-in closets, a pool, spa, gourmet kitchen, and so on, the higher the price. Lot size: Is there room for the buyer to add on to the house or plant a sprawling rose garden in the backyard? The exact acreage of your land correlates to price. When you compare your home to others, stay within .05 acres. Condition: The condition of your house can be a deal-maker or a deal-breaker. That’s why you have to pay close attention to other homes’ upgrades to make a fair assessment of how they affect value. Location: This relates not only to your city and neighborhood, but also to where your house sits on the street. Does it face an eyesore or busy intersection? Does it have a view? These location nuances make a difference. 2. Don’t Look Back (Too Far) The price of your home today can’t be compared to the selling price of your neighbor’s identical home 6 months ago. This has been a year of quick price increases in most cities. If you’re looking at comps further back than 3 months, dump them. Your house could be worth more. In fact, in some of the fastest-paced cities, like New York, Miami, and San Diego, homes move so rapidly that sellers should only look at the prior 60 days of sales, if possible. 3. Check Out the Competition in Person Don’t analyze your comps on paper alone. Get moving! Ask a realtor (Allen Cofield) to recommend homes you should drive by or open houses you should attend—or schedule a time to go together. Find out up close and in person where your home stacks up against the competition. 4. List vs. Sale Prices The difference in percentage between list prices and actual sales prices for the homes in your neighborhood speaks volumes about the current real estate climate. This number is a strong indicator of which direction the market is moving, and it will suggest how much under – or over – your ideal asking price you can expect to get for your home. Anyone can throw a house on the market at a high price. But the number you want to look at closely is the sale price of the home, which is much more indicative of the actual value. 5. Know What’s Not Selling You can learn a lot by observing not only what IS selling nearby, but also what’s NOT selling. Is a home that initially looks like a comp really overpriced for what it offers? How does it compare with your house? What is it lacking that yours isn’t? Once you identify why it’s not selling at its current price, you can avoid the same mistake when determining your own home’s price tag. But remember, always work with your trusted real estate professional to determine how your local market is moving and what may be a smart price for your home. If you would like an in depth analysis with a professional, Feel free to reach out to us at www.gotidahorealestate.com, we will be glad to help you. Allen Cofield, Broker Associate (208) 908 - 1777
