Making the decision to list your home is the first step in selling it. This is one of the most significant steps you will take in the process. After this, the main priority is determining a listing price.
Whether you’re working with an experienced real estate agent or selling your home yourself, pricing a house isn’t easy. Instead of second-guessing yourself and continuously asking, “How much is my home worth?” you need to come up with a concrete answer. Follow the expert tips by Robert DeFalco Realty to guide you through this challenging process.
How to Determine Listing Price for Houses
Many factors go into determining a listing price. These tips will help you understand what goes into pricing a home, the strategies you can use, and the different aspects of coming up with your final listing price.
Conduct a Comparative Market Analysis (CMA)
When determining a listing price, there’s no better tool in your arsenal than conducting a comparative market analysis (CMA). A CMA compares your property to recent sales in the area. It includes details about the house, the final sale price, days on the market, and more.
While some sellers do this independently, the best way to go about this is depending on a realtor. No property is exactly like another one, and realtors can consider differences. Since they’re familiar with the neighborhood and locale, they can come up with a fair listing price.
When it comes to a CMA, you have to consider many different factors. The houses you compare have to be within a ¼ to ½ mile radius of your property. They also have to be similar in age and square footage. Additionally, they’re usually ones that have been listed in the last three months. All of this can get complicated very quickly. This is why most home sellers prefer a realtor’s guidance.
Keep the Current Real Estate Market Conditions in Mind
If you want to come up with the best possible listing price, it’s important to keep the state of the housing market in mind. This includes factors like seasonality and whether it’s a buyer’s market or a seller’s market. If there are many other houses on the market and the supply exceeds demand, the pricing strategy will differ. Your final number won’t be as high as it would be under different conditions. Keep these aspects in mind when determining your listing price.
Pay Close Attention to Online Prices and Specific Prices
Technology has become an important part of the home buying process in today’s digital age. In fact, 44% of home buyers search for properties online. 99% of millennials use the internet in the home buying process. This makes catering to online searches essential when determining a listing price.
Consider popular price ranges when pricing your property. For example, if buyers are searching for homes between $300,000 and $320,000, it’s not wise to set a listing price of $325,000. Instead, you should aim for something like $319,999 to fall within the range.
You should also avoid obscure pricing. Strange and obscure numbers like $312,936 aren’t attractive to buyers. Instead, embrace a popular psychological concept called charm pricing. You can set the price just under a round number to make it seem more reasonable. For example, instead of pricing a home at $400,000, you can set the listing price as $399,999 or $395,000.
Don’t Be Afraid to Reduce the Listing Price
Once they’ve determined a listing price, real estate sellers have difficulty cutting the price down. However, this is sometimes important. No matter how much research you do, it’s possible to overprice a house. Instead of letting your listing grow old, take steps to adjust the price. According to Zillow, 64% of sellers reported lowering their asking price at least once.
It’s essential to change the price once instead of making reductions over time. The older your listing is, the less attractive it is to buyers. If you want to sell your house quickly, pay attention to feedback and adjust the listing price as needed.
Take Your Cue From Others
When setting a listing price, the best thing you can do is research your competition and learn from their mistakes. Look at expired listings and see where they went wrong. Don’t repeat their mistakes.
You should also pay attention to your current competition. While you may want to price your home competitively, don’t get lumped in with other sellers. For example, consider that the majority of homes around you are listed between $300,000 and $310,000. If the next price bracket starts from $320,000, you should take advantage of the empty $315,000 price band.
Be Careful When Underpricing
Overpricing your property is one of the worst mistakes you can make as a home seller. However, underpricing is often considered a strategic choice. It can boost interest in the property and can even encourage bidding wars.
However, sometimes the strategy doesn’t work. It can fail, and you can end up setting too low a listing price. You can both lose out on money and alienate buyers in this case. If the listing price is too low, buyers can start to wonder if there’s something wrong with your property.
Consult an Experienced Real Estate Agent
An experienced realtor can be a major asset when it comes to setting a listing price. According to the National Association of Realtors (NAR), determining listing price and pricing a home competitively is among the top three reasons people hire realtors.
Robert DeFalco Realty Can Help You Determine Listing Price
We can’t stress the importance of setting a suitable asking price enough. Overpricing a house can lead to devastating consequences. These include driving away buyers and extending the time your house sits on the market.
Instead of depending on inaccurate methods like using a listing price calculator, let Robert DeFalco Realty help. Our seller’s agents can help you throughout the home selling process. From conducting comparative market analyses (CMAs) to finalizing the price, we can simplify the home selling process.