What Sellers Need to Know

Selling a home in today’s market is significantly different than it was even four or five years ago. Sellers need to understand how a realtor looks at and interprets market value for any given listing.

When a realtor looks at the potential list price of your home, he or she will look at several factors. The most obvious thing is the price of the homes in the area that are currently on the market. These are the homes that will be the competition. This market is both a beauty contest and a price war, so ideally you want to have an attractive home but aggressively priced against the competition. And yes, you will have to be competitive with the foreclosures. Every buyer out there is looking for a great deal right, so pricing a house well above market is just setting yourself up for failure. Starting out with a high price to see what happens, again is just setting false expectations that a buyer will come in and overpay for a home.

Next, and the most important, is the selling price of similar homes in the same neighborhood. In many cases sold properties may be a combination of short sales, foreclosures and traditional sales. Yes, that’s right, the foreclosures have to be considered because market value is determined by the price that a seller is welling sell and a buyer is willing to buy. Now of course we can make adjustments for the condition of the homes, but in many cases the foreclosed homes are in pretty good condition.  

Another obstacle to consider, especially if you are going to list your home knowing its priced high, is that if an offer is made, the house will still have to go through the appraisal process. If the home does not appraise at the sales price, a price reduction may be in order.

Emotionally, it is hard to sell your home at a value that you feel is too low. But, after your home is sold, you will become a BUYER. At that point you will be the one out looking for a great deal. So your mindset as a seller is to sell your home with a competitive price, knowing that you will make up for that loss by finding that great deal for your next home.

Good Selling!