If you have a ready-to-buy, bank pre-qualified or cash buyer who is willing to pay a price you will accept, that is referred to as “sale price.” It is an objective fact without influence. This sale price transaction, once complete, will influence the market value of homes in the area. You determine the price of your home by looking at comparable local sales provided by a professional real estate agent, your property’s condition and the current supply and demand. What a piece of property might sell for based on features and benefits in a competitive market, the current supply and demand of similar homes is its market value. You might value your home at a higher price than what a buyer will pay or its true market price. Balanced markets will equalize market price and market value. The perspectives of buyers and sellers also come into play when placing value on a home. Let’s say your home has an abundance of mature trees — a plus in your mind. But a buyer who loathes raking leaves will see that as a negative. If you just spent $10,000 to replace your roof, you might think you can set a higher price but buyers already expect the roof to be in excellent shape. Proximities to schools, bus routes and medical facilities can also create value that certain buyers are willing to pay for. Buyers look for the right deal but what they are willing to pay or the bank is willing to finance has limits. Strategic pricing is your greatest tool when selling your home.
PRICING EXAMPLE
A homeowner decides to place his home on the market and must decide on an asking price. By rough estimate, the home’s market value falls between $290,000 and $300,000. Many homes are on the market. These are some pricing considerations and approaches to finding that “right price”:
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