Home Pricing Do's and Don'ts

Home pricing is both a science and an art based on research and instinct. It requires skill, market knowledge, and experience to determine a price which will yield the best results.

Buyer activity for most newly listed homes occurs in the first few weeks. Therefore, it's important to get the price right from the start. If the home is priced properly, it creates an urgency in the minds of agents and buyers. This is key to generating buzz and enthusiasm for a successful sale.

As a general rule, price is the main factor when it comes to which homes buyers will view. And while sellers set the price, a home's actual value is determined by buyers who choose whether it's worth the price. Typically, buyers wait for the "right house" in their price range. When a house is priced correctly, it will sell quickly as a result of these waiting buyers. 

General Home Pricing Tips

1. Compare your home to homes that are currently on the market and homes that have recently sold. This comparison should weigh heavily when determining a home's sale price.

2. Be objective. Don't let your love for your home impact your pricing strategy.

3. Work with a qualified real estate professional who will provide facts, advice, and marketing strategies. 

Pricing versus Overpricing

The ultimate goal is to get the sale. The benefits of pricing your home correctly far outweigh overpricing your home. Take the time to choose the right price from the start.  

Benefits of Proper Home Pricing 

• Attract buyers.

• Realize the highest possible return. 

• Faster sale with less inconvenience.

• Get greater exposure to more buyers.

• Increase response from real estate professionals. 

• Higher number of advertising/sign calls.

• Attracts higher offers.

 

Disadvantage of Overpricing Your Home

• Attracts the wrong buyers.

• Lower response from potentially qualified buyers.

• A price too high helps sell similar homes that are priced lower.

• By starting high you may be forced to reduce the price later. This strategy usually backfires. By the time the price is lowered, interest will have waned and it may be too late to re-engage interested buyers.

• Overpriced homes can result in problems during the appraisal process. If the home appraises at a significantly lower price, this can lead to loan rejections and lost time.

• Lower the number of interested buyers. If the price is too high, buyers won’t view the home even if it is nicer than other homes in the same area. 

• Buyers and agents know if a house has a long exposure period. As a result, the home can be seen as "shopworn" and buyers are often hesitant to make an offer as they fear something is wrong with the property.

• Incur unnecessary expenses. The longer a house sits on the market, the more you will incur expenses. For instance, you must continue paying your mortgage, taxes, insurance, and any unforeseen maintenance costs.

Common Reasons for Overpricing your Home

• Over-improvement of the home.

• Purchasing in higher-priced area.

• Original purchase price was too high.

• Lack of accurate market data and trends.

• Homeowner wants “bargaining room.”

• Move isn't imperative.

• Assessed value is higher than current market value.

• Emotional attachment.

• Opinion of family and neighbors.

Working with a Real Estate Professional

When it comes down to it, there is no one way to determine an "exact price" for real estate. While you will have an opinion about what your home is "worth," a real estate professional will recommend a price based on the home’s value. Working together, you will be able to determine the optimal price. 

Qualified Real Estate Professionals will:  

• Provide a comparative market analysis (CMA) of your home. The CMA compares previously sold homes in the area and currently active homes in order to understand comparable homes with competing price points. 

• Remain up to date on market trends and activity of comparable homes.

• Estimate your net proceeds.

• Recommend ways to make your house show ready - interior and exterior. The price of your home will vary based on factors that you can control. These factors include the home's current condition, appearance, cleanliness, and deferred maintenance projects. 

• Help you get the best possible outcome.

The South Shore real estate market as a whole is diverse area with each community claiming  its own character and unique price points. Our professional team has in-depth knowledge for what it takes to sell homes in each town. We have relationship networks to get the most exposure for your property. In addition, we employ marketing strategies tailored to the right buyers with the right message. We work with you for a smooth transaction and the most successful outcome.