Posts tagged pricing your home

How to Be Realistic about Price

Jun07
2010 Leave a Comment Written by Shanna

pricing realistically

As a home seller eager to make a profit on your sale, it can be easy to lose sight of an important truth: Your house is worth what a buyer is willing to pay.

Not what it sold for.

Not what you invested.

Not what you want a buyer to pay.

Your house is worth what a buyer is willing to pay.

So when you’re trying to price your home realistically, it’s helpful to think in terms of that fact, asking yourself what price a buyer would realistically be willing to pay for your home.

How can you best estimate what price that would be?

Ask yourself some questions:

  • What do other sellers of similar homes think buyers will pay?
  • What have other buyers paid for similar homes recently?
  • How will my home compare to the competition?
  • How fast are homes selling in my area?

These questions will help you gather valuable information that can lead to an estimated range for pricing your property. Ideally, you want to price just a little higher (around 2 to 5 %) than what you think a buyer will pay, in order to leave room for negotiation.

Of course it’s always tempting to price higher, in hopes that someone will come along who wants your place. But the only person who loses in that situation is you, while you wait longer on the market.

So price carefully, and you’ll price right.

Posted in Selling Tips, Tips and Ideas - Tagged , , ,

The Basics of Pricing Your Home

Sep28
2009 1 Comment Written by Blog Master

save money

You probably already know how significant the listing price of your home can be. Price too high, and you scare away qualified buyers; price too low, and you get less money than you could have. We’ve written here at the Buy Owner Blog about the perils of poor pricing before, but let’s talk now about the way to do it right:

Determine Your Margin
One of the first factors you need to consider is equity. If you’ve been in your home for several years or if you put down a large down payment, you have a pretty good idea how much money you’d like to get out of the house when you sell. That number may be tainted by your financial situation, if, say, you’re in financial trouble and need to sell quickly, in which case it could be best to lower your price, even if you take a short-term loss. No matter what, you need to make sure you’ll get enough money out of your house to pay off the mortgage and find new living arrangements. In today’s market, in some areas, the upside-down nature of real estate could make this a difficult proposition.

Do Some Research
The local MLS and a quick online search can help you identify properties that are considered to be comparable to yours. If you want to sell your house quickly, price your home as the best deal on the market by setting your price lower than all similar ones in your area. By using Buy Owner, you’re already cutting the cost of commissions, so lowering your price should be possible to do without taking a significant hit to your profit.

A real estate appraiser can also help you price your home. Most buyers will need a recent appraisal in order to qualify for a mortgage on your home anyway, so it may be worth the small investment required to have the home appraised prior to putting it on the market. Any time you can sell your home “below appraisal,” you have a better chance of selling it quickly.

If you price your home and no one comes to see it, you may have priced it too high. Remember that one of the best reasons to sell by owner is the flexibility it allows, and you can always lower the cost of your home if activity is less than you desire or if offers come in significantly lower than your asking price.

Posted in Selling Tips, Tips and Ideas - Tagged , , ,

How to Sell Fast

May11
2009 Leave a Comment Written by Shanna

How-Sell-House

Just about every home owner who decides to sell has the same concern: how long is it going to take? (That, and how much money will be made.)

And as you probably know, the simplest answer to that question is that it depends. All kinds of factors influence time on the market, including number of other homes for sale, price listed, quality and condition of property, etc. There are no guarantees, but, let’s be honest, that’s not what you want to hear, not if you’re selling your home.

Essentially, there are two ways to increase your chances of selling quickly:
(1) Price competitively and (2) Make your home look fantastic.

(1) Price: Price competitively, and price it right from the beginning. If you list the home for more than you think it’s worth, buyers will know, especially in this market where there are an abundance of homes for sale. Sure, you can lower the price later, but your home will have been on the market longer, and buyers will know that, too. To avoid being passed over for inflated pricing or considered stale when finally at the right one, price right from the beginning.

For more information on pricing, see these Buy Owner Blog articles:

• The #1 Mistake of Home Sellers

• Is It Time to Drop Your Price?

• Why Your Home Isn’t Selling

(2) Amenities: It’s a basic rule of competition – outshine the others. Remember that in today’s market, there are many homes for sale. Beyond price, the #1 factor that will provoke a sale is the quality/condition of your residence and what amenities it offers. Now is the time to get your home clean and in showcase condition.

For more information on getting your home in showing condition, see this Buy Owner Blog articles:

• 12 Tips for Staging to Sell

• Top 10 Home Staging

• Why Staging Works

Posted in Selling Tips, Tips and Ideas - Tagged , , ,

When Will Real Estate Bottom Out?

Dec31
2008 1 Comment Written by Shanna

As we close out 2008, the nation looks ahead with hope for an improved housing market in the coming year. Will 2009 bring property values back up? Will this next year see the rise of home sales across the country, as the market returns to normal? Will a flood of more confident buyers emerge, turning the tides in favor of sellers again?

The short answer: Time will tell.

But meanwhile, the Internet world is filled with opinions, some local and some national.

In Seattle, a late-November article cited Jonathan Miller, a PricewaterhouseCoopers consultant and lead author of the annual Emerging Trends report, who said: “Forget the quick fix: 2009 will be a downer; we don’t think 2010 will be much better … We’re hoping that by 2011, we’ll be in a slow recovery.”

In Asheville, NC, according to a Citizen-Times.com article, hopes are high only for those who have cash on hand. “Although the real estate bubble has burst, the bottom is still many months or years away,” writes Mike Summey, coauthor of the “Weekend Millionaire book” series. “Prices will continue falling, foreclosures will increase, and lenders will be very cautious until the market comes back in balance. Once income is again able to support purchase prices, the markets will start to recover. Until then, investors with cash and good credit are in the driver’s seat and will continue to make money when they buy.”

Californians are more optimistic: According to an article in LA’s Daily News, Mike Schniepp, head of the Santa Barbara-based California Economic Forecast is quoted as saying, “The Santa Clarita Valley housing market should recover by next summer (2009).”

Florida also expects good news, especially if the state’s values have already hit bottom and are set to increase. The Charlotte Sun wrote last month that “Existing Florida home sales are up and plummeting property values may have bottomed out. That’s the encouraging message from two real estate reports released Wednesday on Florida home values and single-family home sales in the third quarter.”

What does this mean for you as a home seller or home buyer? Remember to keep in mind that real estate is local, so your area’s trends will have the greatest impact on pricing. Also remember that no matter what the market is like, there are always people buying and selling properties. Do all you can to market your home at its best!

(All bold type added by the author of this blog post, not appearing in the original quotations.)

Posted in Market News, Tips and Ideas - Tagged , , , , , ,

Lowball Offers

Dec08
2008 1 Comment Written by Shanna

Picture this: You’re selling your home using Buy Owner® advertising, meaning professional photographs, quality ad descriptions, gorgeous virtual tours. As a motivated seller, you get the word out, hold open houses and, most of all, price your property fairly.

Then, one day, it happens: you get your first offer. You’re thrilled! You can sell your home and move into your next one! Only problem? The offer is lower than you’d expected. A lot lower. In fact, it’s what some might call a lowball.

What should you do?

First of all, don’t panic. Don’t get angry, frustrated or worried, either. This is just the first offer, and now negotiations can begin.

Depersonalize. As much as possible, remove your personal attachments from the home. Think of it objectively as a property that you need to sell, part of a financial transaction only. (Want more advice on depersonalizing for a sale? See Buy Owner Blog article, ”Depersonalizing for a Home Sale”

Know what you need. Look at how much you actually need to get out of the property in order to accomplish your goals, whether that means how much you need to move into your next home or how much you need to turn a profit on the sale.

Do your research again. If you priced your home fairly to begin with, it was based on facts and figures of recently sold properties in the area. Before writing off this low offer, take a look at data that the buyer likely based their offer on: market conditions, area homes for sale, recently sold properties, etc.

For more information on pricing your home, see these Buy Owner Blog articles:
• The #1 Mistake of Home Sellers
• Is it Time to Drop Your Price?
• The Mistake You Can’t Afford to Make
• Why Your Home Isn’t Selling

Begin negotiating. Successful negotiation is all about give and take. If the buyer offered much less than the asking price, counter with a number a little lower than your original request. The goal is to keep the negotiations flowing, arriving eventually at something in the middle, which you can both be happy about. Remember to stay positive and hopeful, both in your attitude and in your interactions with the buyer.

For more information on negotiation, see these Buy Owner Blog articles:
• Negotiating Tips
• 10 DOs for Dealing with Potential Buyers
• 10 DON’Ts for Dealing with Potential Buyers

Posted in Selling Tips, Tips and Ideas - Tagged , , , , , ,

Is It Time to Drop Your Price?

Oct10
2008 1 Comment Written by Shanna

According to a recent CNBC.com article, today’s market conditions have prompted at least one real estate brokerage to act decisively. Coldwell Banker Real Estate has asked its sellers to lower their asking prices by 10% as an incentive to buyers. Based on this and the multitude of economic changes happening day by day, one thing is clear: In light of today’s tough economy and the softer real estate market, it’s time to start rethinking your selling strategy.

Before you do anything else, ask yourself: Is it possible your home is priced too high?

Forget what you want to get and what you thought you’d get. It doesn’t matter how much your home was worth five years ago or what you expected it should be worth by now. When it comes to home values, there’s a simple bottom line: Homes are worth what buyers are willing to pay—period.

According to many experts, there are currently more homes on the market than there are buyers. This means buyers get to be picky, and they’ll be expecting a good deal. Inaccurately high prices result in disinterested buyers and complicated and incomplete sales. Take time to research comparable properties and to study home markets to ensure that your property is priced for a quick and fair sale for all involved.

Not sure where to begin? Take a look at these other Buy Owner Blog articles: “Why Your Home Isn’t Selling, “6 Tips for Selling in a Slow Market” and “The Mistake You Can’t Afford to Make.”)

Posted in Market News, Tips and Ideas - Tagged , , ,

Why Your Home Isn’t Selling

Apr20
2008 3 Comments Written by Shanna

PricingHave you had your house on the market for months without an offer? Are you frustrated by the lack of response to your advertisements, open houses and hard work?

Very often, it all comes down to one word: price.

According to many experts, there are currently more homes on the market than there are buyers. This means buyers get to be picky, and they’ll be expecting a good deal.

Homes that sell quickly have one big thing in common: they’re priced competitively.

How can you be sure your home is priced right? Here are some things to keep in mind:

1) General Market Conditions
Home pricing is a matter of supply and demand, which changes with market conditions. The completed sales and active listings of comparable properties in your area (key: within the last six months or less) will give you a good idea of how things are going.

2) Specific Competition
You’ll want to research homes within one-quarter to one-half a mile away. Perceptions and desirability matter. Pay attention to physical barriers and neighborhood dividing lines such as major streets, highways and railroads. Identical properties vary widely by location price-wise.

Also, compare homes with similar square footage (more or less 10 percent), at similar ages. Is a neighborhood home listed for $40,000 less than yours? Think like a buyer and determine if your property has enough features to make that financial investment attractive. If it doesn’t, you’re overpriced.

Pricing your home to sell is a matter of balance, dictated by location and market demands.

Inaccurately high prices result in disinterested buyers and complicated and incomplete sales. Grossly low prices host similar disinterest, running the added risk of selling yourself short without maximizing profit. Take time to research comparable properties and to study home markets to ensure that your property is priced for a quick and fair sale for all involved.

For more information, see Buy Owner Blog article “The mistake you can’t afford to make.”

Posted in Selling Tips, Tips and Ideas - Tagged ,

The Mistake You Can’t Afford to Make

Nov26
2007 3 Comments Written by Shanna

moneyAsk yourself how much your home is worth, and you may tend to see things in terms of personal history.

Especially if you’ve lived there for a while, it will be hard to look at things objectively. There’s the garden you planted, the hardwood flooring you hand-installed, and the years of memories that no one can put a price tag on.

But, the truth is, when it comes to pricing your home, you have to look at this objectively. Sure, there’s a buyer out there who will love your home as much as you do, but not if you scare him or her away before seeing it.

The mistake of overpricing could mean:

*Prolonged time on the market.
*Few calls or showings, if any.
*Discouragement as you wait for a buyer.
*Ultimately: money, time, and energy lost.

Let’s look at the facts.

What is your home really worth? Whatever a buyer is willing to pay for it.

In addition to the info here, you will want to keep these extra tips in mind:

  1. Coming up with a price is really an educated guess.

    2. A comparison of similar homes; a consideration of the average time on the market; a recognition of the percentage below/above asking price homes are selling for; a recognition of homes currently for sale; and an awareness of market trends and movements all come into play. This research leads to a price range that should appeal to buyers. It is just a range though, a guess based on other properties and on the market. Stay flexible.

  2. Homes sell for what buyers will pay.

    3. Competition affects your home’s selling price. If you list your home and receive dozens of offers immediately, you’re probably underpriced compared to the others on the market. A bidding war will only benefit you, though, as it will drive up your property’s market value.

  3. Stubborn overpricing benefits no one.

    4. You’ll keep a home you want to sell, the buyers won’t get the home they want to purchase and no one wins. The financial losses involved with mortgage payments, the burden of keeping your home showcase-worthy and the stress of wanting to sell will discourage you.

Don’t let it happen by refusing to see the conditions around you. Price competitively!

Posted in Selling Tips, Tips and Ideas - Tagged , , , ,

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Founded in 1984, BuyOwner.com® is the leading provider of real estate marketing services. We pioneered the "For Sale by Owner" (FSBO) market, which today represents over 20 percent of all residential real estate transactions.

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