Selling your home can be the start to an exciting new adventure, but if you want to make sure that adventure is a good one, make sure you don’t set the wrong list price! How could you fall into this trap? It usually happens because you don’t have all the information you need.
Setting Your Home’s List Price without Research
Davie homes for sale that are overpriced historically end up for selling for less than market value. Homes that are under priced will most definitely sell for less than they are worth. You owe it to yourself to get the price right. Here’s what typically happens if you don’t do the research:
- You use a quick formula like price per square foot to determine your list price. Price per square foot is just about the worst way to set a home price. Think about two homes in the same neighborhood that are the same age and have the same square footage.One home was built with low-cost aluminum siding, the other home has the best quality money can buy. One home has inexpensive carpet flooring, the other one has real hardwood throughout. One home has inexpensive kitchen counter tops, the other home has all granite.I could go on, but I’m sure you’re seeing the problem. Just because two homes are the same size and in the same neighborhood, that doesn’t mean the price per square foot is going to be anywhere near similar. Any quick pricing formula is going to cause you problems.
- You set your list price based on what you need to buy your next home. The value of your home has nothing to do with the fact that you think it should have appreciated by $20,000 and you’re planning to use all of that appreciation as a down payment on your next home. If your estimate of appreciation isn’t accurate, you’ll set your list price too high or too low.
- You set your list price based on advice from a friend or real estate agent. Advice from a friend or even a real estate agent, unless they have the research to back it up, is just an opinion.
- You use your list price to test the market. You want to sell for the highest price the market will bear. But, if you use your list price instead of research to determine what the market will bear, you’re doing yourself a disservice.
Typically what happens in this situation is that you price the home high and plan to drop the price if you don’t get any interest. This gets you right back into overpricing your home. And, there are very good reasons why that doesn’t work.
For example, if your home should sell for $200,000 and you have it priced at $250,000, you won’t get the showings you need to find a buyer. Buyers looking for a $200,000 home won’t look at your home because they don’t believe they can afford it. Buyers looking for a $250,000 home will find yours lacking in comparison to the other homes they see in that price range. You may get some showings, but people who might actually purchase your home won’t see it.
At that point, you’ll run into the problem of the house being on the market for a long time. Buyers will often assume that there is something wrong with the house and won’t want to consider it. That perception will get even worse as you lower the price time and again or take it off the market then put it back on again. In the end, if you really want to sell your home, you’ll end up selling below market value.
If you want to set your list price right the first time, give us a call at 954-242-8030 or send an email. As local Davie real estate experts, we can do the research and show you how to identify the list price that will get you the most for your house in the shortest amount of time!