We all want to be able to get a nice profit from selling our homes. But with the market volatility of the last few years, is this reasonable? How can someone get a true idea of how much their home is really worth nowadays?
Well, here are five things that will help you determine the relative value of your home today:
1. Have realistic expectations. We all have attachments to our homes, and we can wish that potential buyers would feel the same way. However, buyers have their own agenda, to get the most house they can for as little money as they can. They can appreciate that you’ve invested time and money on that new floor, those freshly painted walls, that fine looking front yard, or any other improvements that you’ve made over the years. That doesn’t mean that they’re going feel that justifies a high price for your property.
2. Find out what the market is willing to bear. Ask your local real estate professional to check out your home and determine how much your selling price should be. This process is called a Comparative Market Analysis (CMA). This analysis show houses similar to yours that have sold, that are on the market, or that are currently under contract. You don’t want to be too far off from those homes that are currently on the market; they are your competition. Ask why these homes were included in their analysis and if there are other similar houses excluded.
3. How much per square foot is your home? Calculating the square footage of your home is a good foundation on deciding your selling price, but that’s not the only thing that should be considered. Location, condition and other environmental factors can have an impact on the price as well. Keep in mind that there are different ways to calculate the square footage; for example, a good rule of thumb is how much area is air conditioned vs. total square footage including garage, porches, etc.
4. What’s happening in the market? Are prices going up or down in your general price range? How long are houses on the market before they’re sold? What time of year is it – are the snowbirds down, or is it the middle of summer? How are the interest rates? Are there a lot of houses on the market, or are there just a few? What’s the jobs report saying and how good are the economic conditions?
5. How can you make the offer irresistible to a buyer? Sometimes it’s not just the selling price that’s attractive to buyers, but whether you’re willing to help the buyer get into your house. Being flexible goes a long way. Can you assist a 1st time homebuyer with closing cost assistance? Maybe you can meet the buyers half-way with needed repairs (roof, ac, plumbing, electrical)?. Are you willing to make concessions if it’s a cash deal or a quick close? Being flexible with selling your home will help to shorten the time it takes to sell your home and put cash in your pocket.
If you want to sell your home reasonably quickly, using these tips in pricing your home will help reduce the time on the market and keep your expectations in check. Nobody wins if their home is priced too high for the current market, discouraging buyers from viewing and making an offer.