When getting ready to sell your home, there are a lot of factors to consider.
In 2019, the average net profit for selling a home in the United States was over $65,000. Of course, the amount that you stand to earn from selling your home will depend on several factors.
If you want to know how to price your home to get the most out of your real estate investment, we’ve got some insights before you lock down the number.
Keep reading to learn seven key factors when pricing your home – and know how to price it to sell.
1. Don’t Overprice It
Many people think about going over the market value when pricing a home.
This strategy is used as a tool to then bring down the price as if the seller were giving a buyer a much better deal.
However, if you overprice your home, you leave out potential buyers whose budget is your lower price point. For instance, if you want to sell for $499,999, but you price your home at $520,000, your listing will not be available to buyers browsing online.
2. Don’t Go Below Market Value
Underpricing a house also has some setbacks. The goal of setting the price for a house under the market value is to hope for a bidding war between two buyers.
This is now always possible and you may end up with less than what the house is worth.
Additionally, it is a risky strategy because, with a low price, buyers might assume that there are issues with the house that will cost more down the line. Make sure to accurately price your house right from the start.
3. Account for Renovations and Upgrades
There are certain upgrades in your home that you want to take into consideration when pricing a house.
If you’ve done some foundational or structural work on your house, you are likely to get a decent return on that investment. However, if you’ve done some personal remodeling, like a chef-style kitchen or a hot tub in your backyard, not every buyer will see the value in those types of upgrades.
Factor in things like a basement remodel which can be used as a separate living space and potential stream of income. You can also factor in if you’ve had hardwood floors installed. These are the types of renovations that you will want to include in your pricing and will get you a great return.
4. Leave Room to Negotiate
When it comes to the price of your house, be prepared to negotiate the price.
People love to haggle when buying just about anything and real estate is no exception. This makes people feel like they’ve gotten a discount so it helps to let them feel like you’re cutting them a deal.
Make sure to give yourself the wiggle room to make that deal.
Another way of giving the buyer a deal is to price the house with the added cost of closing. You can keep the price of the house, but offer to cover the closing cost for the buyer.
5. Don’t Factor in Your Emotional Attachment
You can put a price on the sentimental value of your home. You might have had lots of memories in the house and lots of emotional attachment, buyers are not going to be able to measure that in your home’s value.
It is best to emotionally detach yourself from your property and look it at from an objective perspective. If you want to price your house accordingly, you must remember that you are engaging in a business transaction.
Try focusing on all of the measurable and tangible value that your house has.
6. Compare Prices in the Neighborhood
One of the most important insights for home selling is comparing prices. Many factors will determine the price of your home like the square footage, the number of bedrooms, the location, the neighborhood, and so on.
When you’re gearing up to sell and locking down your price, you want to ensure to get “comps” or “comparables”. Check out your neighborhood for other homes that are for sale with similar square footage. Your home will likely be priced at a similar number.
7. Get a Professional Opinion
Getting a professional on the job is one of the best ways to ensure that you get the right price for your home.
The real estate agents in your area will be able to visit your home, make an evaluation, and give you an estimate of what you could potentially sell for.
They can see strengths and weaknesses in your home that you might not be able to see. You might have a great feature in your home that you didn’t know could raise its value. Likewise, they could point out areas of your home that might affect the price.
Additionally, if your agent gives you an estimate, ensure that you double-check the numbers. Do your research and don’t hesitate to get a second opinion from a realtor that you trust.
If you want to get a home cash offer, getting a professional on the job is your best bet.
Remember These Seven Tips on How to Price Your Home
Knowing what your house is worth is important in getting the right return. If you want to know how to price your home, remember these seven important insights. Set the right price from the start, factor in your renovations, leave room to negotiate, emotionally detach, and compare prices.
Remember to get a professional opinion if you want to sell your house for the right price.
If you’ve found this article useful, be sure to keep visiting our page for more information on real estate and home pricing.
