How to Increase Your Home's Sales Price: Pricing Your Home Correctly
One of the biggest issues that causes homes to either sit for extended periods on the market or sell for far less than the asking price is incorrect pricing (usually it's a too-high price for what the market demands). It sounds obvious, but the best way to increase your home's sales price is to price it correctly. You'd be surprised how many people don't follow that strategy, though (and frankly, they get poor results as a consequence).
Think about it - if you were a buyer and a beautiful single family home came up for sale on the market, but it was tens of thousands of dollars over what it was actually worth, would you want to make an offer? Even if that home checks all of your "ideal home" boxes, if the market rates don't support its advertised value, then it's not worth your time and energy.
So how do you figure out how much a house is worth?
The best way to determine a list price is to tour other properties that you're competing against. The bottom line is that you're entering a competition in the market for eligible buyers within a certain price range, and just as buyers shop around for cars, they're going to shop around for homes.
If you were a buyer, wouldn't you be looking for the house that has the most value for the price? Otherwise, why make the investment?
Many people think that relying on numbers online is the best solution. It's helpful, yes, but to really know what is out there value-wise, you have to go through houses. How else can you experience how it feels, its layout, the view, and more? Numbers are logical, but buyers are looking for more than logic; buying a house is also an emotional and personal experience.
Let's take a case study as an example. House A and House B are exactly alike in every way (price, square footage, number of bedrooms & bathrooms, etc.). However, House A has newly refinished hardwood floors and a view of a local park. House B has carpet that needs updating, it still has wallpaper from the 90s, and it faces a busy road. Even though both are "the same" according to an appraisal checklist, there are elements that buyers will either pay more for, or want to negotiate the price down for (or even forego the house altogether). House A is clearly the winner in this situation, so if you were a seller about to put your home on the market, you would need to take into consideration all of the elements - both numbers-wise and aesthetics-wise - to come to a final list price.
The little things are what make a difference between earning $10,000-50,000 more on the sale of your home, so it's critical that you make it a point to price your house correctly. I recommend viewing 10-20 homes before you go on the market to ensure you have a full and accurate understanding of what you are about to compete against, and how best to position your home to attract the most buyers.
Remember: Price your home correctly, and your chances of selling it quickly and earning more from the sale grow exponentially.
(Want more info on how to increase your home's sales price? If you haven't checked out our other posts in this series, be sure to click here and here for details on small repairs & interior cleaning.)