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”: • The “leave room for negotiation” approach. In this approach, the market value is “stretched,” say to $305,000. The price will not entice a buyer but might make comparable homes more desirable. The home will most likely not sell quickly or at that price. • The “price it according to worth” approach. This approach sees the price set right between the market value benchmarks, at $295,000. Likely, home shoppers will lump the home with like-priced homes, knowing they can buy any time for $295,000. • The “underpricing generates interest” approach. Underpricing at $280,000 will motivate buyers and perhaps create a bidding war. But the goal of selling the home for more money is derailed.
THE COMPARATIVE MARKET ANALYSIS
When it comes to finding a buyer, pricing your home based off comparable real-priced sales is crucial to making the sale. The comparative market analysis is imperative to pricing strategically. When you ask for one from a real estate professional, be sure to review the analysis, ask questions, and get explanations. No question is unintelligent. The better you understand how the CMA was created and the numbers in it, the more confidence you and your real estate agent will jointly have in the listing price you choose. If completed correctly, this comparison report not only gives you the basis to choose a great listing price but it also reduces the chance of your home being under-appraised. If you have a well-priced home, you should be showing within the first few days 76
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