How hard can it be to sell your home – privately, i.e. sale by owner? Well, if statistics are anything to go by, selling a house privately is no easy feat.
88% of houses sold in the USA were through a real estate agent or broker. While reluctant to agree to their fees, most homeowners appreciate that realtors have the skill, knowledge, and patience to make it through the sales process and finish.
What can be the trickiest part of selling your home privately is knowing the expected sales price. Real estate agents are working in the local market all the time. Their market knowledge of similar properties helps set the right price expectation with prospective homebuyers. But how hard can it be to work out what to list your home for?
If you want to sell your home privately to save on real estate fees in the thousands, then read on.
How To Put A Price On Your Home
Many factors determine the market value of your house. If your home is being sold without the help of an agent, i.e. it’s for sale by owner, follow these steps to determine the correct price of your property:
Comparative Market Analysis
The comparative market analysis is an essential tool of real estate sales for real estate agents and buyers.
Homebuyers need to know they can afford a type of home in a specific location and that a property listed for sale is not over-priced.
Is the sales price being asked by a seller fair? The comparative market analysis will give you confidence that your home is listed for the right price and that it’s up to the prospective buyers to decide how much more they are willing to pay for it.
What Factors Impact On Price
Even with research including historical sales data, there are external and internal factors that can askew property values at the time you want to sell your home:
- Weather Event or Acts of God (Force Majeure) – Hurricane, Cyclone, Tornado, Flooding, Earth Slips
- Economic Event – like a GFC, recession, or boom
- Political Events – change of Government and policies affecting the economy, jobs, home loans
- Climate Change – how the location will cope with rising temperatures, and sea levels etc
- Is the home dated and in need of major maintenance or replacement? For example, the wiring or plumbing needs full replacement?
- How many bedrooms, bathrooms and entertainment rooms do the property have?
- What is the property’s location – is it near schools, transport, food and entertainment?
- What is the crime rate for the area – burglaries and other illegal activity?
Other factors that can make or break your home selling for the optimum price include what time of year it’s listed for sale. More homes are listed and sold in the warmer months.
The majority of the country considers the spring season the best time to sell homes because most people would want to move in during the summer.
The Location Of Your Property
Another factor to consider when pricing your home is the property’s location. If it’s located in a part of town that’s typically considered to have a high demand for homes, you’ll find that the cost of the house will naturally be higher than if the property were in a less popular area.
If your property is near a school, mall, or transportation, this will significantly affect the price of your home because working people and families would like to have a house close to these areas.
List All Your Home’s Features
Aside from location, the features in your home also significantly affect its selling price. The value of a house is roughly based on its square footage and its usable space, including additional areas, like basements, attics, and garages.
An outdated home will achieve a lower price, whereas a modern design and professional finish will get you to get the best price for your house.
The following upgrades and updates are said to increase your property’s value:
- Finished basement
- Swimming pool
- Hardwood flooring
- Modern or upgraded kitchen
- Updated bathroom – plus ideally a minimum of two bathrooms
- Additional rooms, like guest bedrooms, office, or entertainment space
Don’t Make These Pricing Mistakes.
One of the most common home selling mistakes people make is overpricing it. The problem with listing it for top dollar is many homebuyers will be put off viewing the home.
Pricing your property too low is also a bad idea as your potential buyers might think that there’s something wrong with the house. That’s why it’s important to base all your pricing decisions on your comparative market analysis, the location, and the amenities of your property.
Pricing to sell is a balancing act that most home sellers find challenging. Even when you engage a real estate agent or broker, go the extra mile and do your own research. Seek to know what external and internal factors will influence your sale. Ensure to present it as best as possible, improve its curb appeal, and refresh the kitchen and bathrooms. Declutter and stage it for the optimum price. For more tips on selling a home, see here.