MARKET PRICE VS. MARKET VALUE If you have a ready-to-buy, bank-qualified buyer who is willing to pay a price you will accept, that is referred to as “market price.” It is an objective fact without influence. This transaction, once complete, will influence the market value of homes in your 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. Individual perspective also comes into play when placing value on a home. Let’s say your home has an abundance of mature trees — a plus in your mind. 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 get a higher price, but buyers expect the roof to be in excellent condition. Proximity to schools, bus routes, and medical facilities can also create value that certain buyers are willing to pay more for. Buyers look for the right deal, but what they are willing to pay and what the bank is willing to finance have limits. Strategic pricing is your greatest tool when selling your home. FOR EXAMPLE: A homeowner decides to place his home on the market and must decide on an asking price. By rough estimate, the home’s worth falls between $950,000 and $975,000. There are many homes on the market, so what goes through his mind when finding the “right price?” • “Leave room for negotiations” — if the home is overpriced at $1,000,000, it only makes comparable homes more desirable. The home will most likely not sell. • “Price it according to ‘worth’” — Buyers will lump the home
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