THE PRICE IS RI CE IS RIGHT
As the seller, you decide the asking price of your home, either by yourself or with the help of a real estate professional. Either way, you should keep two things at the forefront of your mind. First, avoid letting sentiment play a part when pricing your home. Sentimentality has no dollar value. Although you have emotional connections to your home, the buyer does not. Strive to set all emotions aside during the selling process. Second, there is no direct dollar-for-dollar correlation between upgrade investment and market value. Do not assume you can add the full cost of improvements to your asking price. As previously noted, a $50,000 kitchen renovation will not bring the market value of a $575,000 home to $625,000.
APPROACHES TO PRICING
Assume a homeowner decides to place his home on the market, and therefore, must decide on an asking price. By rough estimate, the home’s market value falls between $575,000 and $600,000. Below are three popular approaches and considerations to finding the “right price”.
• The “leave room for negotiation” approach
In this approach, the market value is “stretched,” say to $625,000. The price will not entice a buyer, but instead may make comparable homes more desirable. The home will most likely not sell quickly, or at that price.
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