Setting a selling price for one’s home can be difficult; the process is not an exact science due to the many various factors that affect the selling price. Asking the right price that would satisfy both you and the buyer is key whether the sale is done on your own or facilitated by an agent.
Setting the price too high will risk turning off more potential buyers in several ways. Buyers won’t see your online listing if they are using lower price points, they won’t consider it outright if it’s out of their budget, or they might decide against it if it can’t compete in terms of value with other similarly priced houses in the market. If at all, it is better to set the price on the low side as it will generate more interest in your listing, leading to multiple offers, which in turn can potentially bump the price up to equal or even more than its market value.
So how do you set the optimum selling price for your property? It may not be an exact science, but there are several things you can do and look at which can guide you in setting a selling price that’s just right.
Supply and demand
The law of supply and demand also applies in real estate. If there are a lot of houses being sold in your area, setting a high price will just make it hard for you to sell. Find out if your neighborhood is in demand, as well as how many houses are on the market in the neighborhood and its surrounding areas.
Scoping the competition
Aside from knowing how many houses are currently listed, you’d also have to determine how they compare to yours. This information is available in newspapers, as well as buyer and seller websites. It would also help to know the houses that were recently sold that are similar to yours, and by how much. You can also do it the other way by checking what are the houses available at the price that you want to ideally sell your house for.
There are also real estate websites that have online calculators which can come up with an estimate of a house’s selling price. You just have to plug in several information such as the price you paid for the house, when you purchased it, its location, its size, and home improvements that you have made.
Help from an agent
If you don’t have the time or the inclination for the DIY approach to selling your house, you can approach several real estate agents to come up with an estimated selling price or a CMA (Comparative Market Analysis). Ask them for the most optimistic price you can possibly get in the current market, and the lowest possible offer you should accept. Get the average from these numbers and you can use this as your selling price, adding some room for negotiation.