How to Price Your Home For Sale

Wanting to sell your home, but not sure how much you should list it for?

Did you know that NOT properly pricing your home can cause it to sit on the market and lose out on potential buyers?

If you've lived in your home for a while you may be attached to it. Of course we all want the most money possible when selling our homes, however, overpricing your house when listing it can actually DECREASE your sales price when it finally sells! Here are some steps to help you determine the best price for listing your home. 

1) Selling your home FAST saves you money!

• When your home sells quickly, you save on monthly costs such as Mortgage payments, HOA fees, Taxes, Insurance, Water, Electric, Maintenance, etc.
• Add up how much it costs you MONTHLY to own your home and keep that in mind for later. 
• A faster sale means less inconvenience for you. If you are still living in the home while selling, you may have to take off work or rearrange your schedule for showings, or to remove pets etc from the home. It's also a lot of work keeping your home museum ready for showings. 
• If you price your home too high, it will scare away potential buyers, who's budget may be just under your price. This means you are paying those monthly expenses to keep the home. 
• Say you want to list your home at $500,000 but it is really only worth around $450,000. Your monthly expenses are around $3,000/month. So you list it at $500,000 because you want to wait for that one special buyer who is going to "see the value" in your home and be willing to pay a higher price. Well let's say it sits on the market for 9 months with no offers because all the buyers see is a high price tag. Well you've just wasted 3/4 of a year and spent $27,000 on monthly expenses to live in a home you are no longer happy in. 
• If you had listed your home at $449,900, you would have gained a whole pool of prospective buyers who's budget may have been just under $450K. You could've sold your home much faster and saved nearly $30K in carrying costs and expenses and have moved into your next home already. 

2)  A LOWER listing price means a HIGHER response from Agents and Buyers!

• WHEN SALES PEOPLE ARE EXCITED ABOUT A HOME AND ITS PRICE, THEY MAKE SPECIAL EFFORTS TO CONTACT ALL OF THEIR POTENTIAL BUYERS. Knowing that it is priced properly for its market, they expect it to sell soon and encourage their prospects to act quickly.  Their excitement is contagious!
• When an Agent sees a new listing that is priced below market value or priced to sell fast, they are going to be calling all of their clients to share the listing. 
• If you price your home LOWER than the rest of the homes in the area, you will get MORE attention from potential buyers.
• If your home is in better condition than similar homes in your neighborhood, consider pricing it at the same price or even slightly below the competition. This will draw all the buyers to YOUR property and could lead to a multiple offer situation. 
• If your home is in need of some updating or repairs, make sure you account for this in your listing price. If you price too high, buyers will only see dollar signs as they walk into your "fixer-upper". However, if you have already priced it well below market value, buyers will think they are getting a great deal!
• Pricing your home lower can draw more attention to your listing and in many cases create a bidding war which can ultimately drive the sales price higher than what it was even listed for!

3) Increased response from Signs and Advertising

• Ad calls and sign calls to Realtors OR By Owners turn into showings when price is not a deterrent.
• If your home is priced too high, when a prospect calls to find out more information they will almost always say "Nevermind, that's too high for what I'm looking for" and hang up. 
• If you price your home LOW, prospective buyers will be intrigued by your home and will want to come and see it!
• Most buyers who are serious about purchasing a home have done some research and have a general knowledge of the local market, or they are working with an agent who will make sure they are not overpaying for a home. 

4) Easier Closing:

• Buyers will want to jump on the opportunity to own a home they feel is Priced Right
• Sellers are less likely to receive low offers, because the home is already listed at a fair price.
• If the buyers are using financing to purchase the home, you will have to be concerned with the Appraisal values. Homes that are overpriced are commonly NOT appraised at the same value. This means that buyers looking to get a mortgage will NOT be able to buy your home, as the bank will not loan then more money than the house is worth. 
• For example, if your home is appraised at $325,000, but you had it listed at $400,000 and the buyers were somehow willing to pay that. If the bank only appraised it at $325,000 then the buyers would need to come up with an extra $75K cash or will have to walk away from the home. This could mean waiting 30+ days for a closing that may never even happen. Which means you'd have to put your home on the market again and start over. 
• Pricing your home at a lower competitive price, ensures less problems for lending with buyers. 

5) Overall what are you goals?

• If a home is PRICED RIGHT, the excitement of the market produces HIGHER SALE prices.
• If a home is properly priced, the market should produce a HIGHER sales price. 
• I've heard a lot of sellers say "Well we aren't in a hurry to sell, we can wait for the right buyer" If this is the case and you aren't concerned about losing money, then by all means, list your home sky high. Keep in mind those carrying costs mentioned earlier to determine how much it is going to cost you to.
• Listing your home too high could cause you to miss out on all the potential buyers. Especially in SWFL, where we have a huge influx of seasonal residents during the winter. If your home is priced too high you are missing out on all those buyers, paying your carrying costs for keeping the home and then ultimately selling for a lower price at a later date because you missed out on the biggest pool of buyers. 
• You cannot change the location of your home, so if the location plays a factor on the sale of your home you need to account for that. You can change the condition of the home and the price. The price is the easiest to control. 
• If you want a HIGHER sales price than consider doing some upgrades or refreshing your home. Paint, new lighting, decor or staging your home to sell can help boost your sales price. 
• If you don't want to put any work or money into your home before selling, then your listing price is the most important when selling yoru home. 
• List to sell, don't list to sit on the market for a year!

Did you know that I offer FREE Current Market Analysis reports for your home? 

If you are thinking about selling and aren't sure what price you should list your home for, I can help you determine the best listing price based on the recently sold, currently active and market conditions in your area.