Thursday, February 7, 2019 / by Nicolette Samash
Deciding what to list your home at can (and should be) a tough decision with thought put into it. There is an emotional side of selling a home, the value that you place on your belongings, your experiences, and the personal touches of your house. Then there is the value that the market, a buyer, and an appraiser will give your home. When deciding on a price to list at initially, there are a few things to keep in mind.
Your home only has one shot to be a “New” listing online and it’s important to not waste this opportunity to get your home in front of the most buyers possible. One common mistake sellers make is listing the home slightly over what they hope to get for it with the intention of negotiating down if needed, giving themselves a “margin” to drop the price. However, when buyers are browsing for homes they are going to be comparing your house to other homes priced similarly. If the market supports a listing price of $150,000 and you decide to list high at $175,000, buyers are going to be out looking at homes on a showing tour and comparing yours to the other ones they see for $175,00. They will logically decide to put offers in on the homes they feel are a better deal.
After the initial push of your listing being “new”, showings are going to slow down. The longer your home stays on the market, the more a buyer feels they can haggle the price down and use that to their leverage, and the more mortgage payments you are going to be making in the meantime.
Our current market is a seller’s market, meaning there is low inventory for the amount of buyers looking to purchase. This is a HUGE opportunity for sellers to potentially get multiple offers on their listing. How do you get multiple offers? You price well - as in at or slightly below market value - to get the most attention on your listing. If you can get the house in a situation where it is being competed for by multiple people they are going to be offering OVER asking price. They will also be catering their offers to be as favorable to you as possible so you will pick theirs over the competition, which means potentially waived inspections, more closing costs being paid for by the buyer, and shorter closing times – all which is more money in your pocket.
Your listing agent will put together a Comparative Market Analysis for you prior to listing you which will show you what other homes similar to yours are being listed at currently. They usually will use this to determine a recommended value to start your home at, or a range of value they recommend. Keep in mind that listing higher usually does not get you the most value for your home and can truly hurt your home selling experience.