Pricing Your Home

While we want you to get the greatest possible return on your home investment, many years of experience have taught us the single greatest mistake in selling a home is pricing it inaccurately. The greatest amount of attention your home will ever receive is in the first few weeks of listing it. Lowering the price at a later date will never generate the same amount of interest as the first rush.

Establishing an accurate list price for your home from the outset involves evaluating a number factors including market conditions and recent sales. We will help you calculate your list price based on:

• comparable sales
• market conditions
• offering incentives
• estimated net proceeds
• pricing considerations

Compare Prices in Your Neighborhood

What someone else is asking for their home up the street is not an accurate value of what your home (or theirs) is worth, but buyers will be comparing your price with other similar homes on the market. Regardless of how attractive your home is, if it is priced substantially higher, it probably won't get shown except out of curiosity.

Your best pricing guide is a snapshot of recent sales in your neighborhood or area. We will provide solid data on recent sales figures for comparable sales and analyze them to help you come up with a suggested listing price.

Competitive Market Analysis (CMA: The list of recent comparable sales, along with data about other houses in your area which are currently on the market, is used to compile a "Comparative Market Analysis" (CMA). A CMA contains other sales data and trends which will help calculate an accurate listing price.

A CMA differs from a formal appraisal in several ways. One major difference is that an appraisal will be based only on recent past sales, not active listings. A CMA may include a mix of sold homes, properties currently listed for sale, and those currently under contract/pending sale. An appraisal is done for a fee, while Heritage Real Estate will provide a CMA free of charge when you list your property. In rare cases, a formal appraisal, which will cost several hundred dollars, may be called for when listing a home. If you have a unique property, if there hasn't been much activity in your area recently, if co-owners disagree about price, if it is an estate sale, or if there are other circumstances which make it difficult to put a value on your home, you may need an appraisal. But usually a carefully compiled CMA gives enough information to help you set a proper price.

Market Conditions  Is it a Buyer's Market or a Seller's Market?

A CMA provided by Heritage Real Estate will include the Days on the Market (DOM) for each comparable property. When real estate is booming and prices are rising, houses can sell very quickly. Conversely, when the market slows down, average DOM can run into many months. We will show you whether your area is currently in a buyer's market or a seller's market. In a seller's market, you can price a bit beyond what you normally expect, just to see what the reaction will be. In a buyer's market, if you really need to sell promptly, offer an attractive bargain price.

If You Price High, Set a Timetable for Adjusting the Price

Some sellers list at or near the rock-bottom price they'd really take, because they don't like bargaining or are in a hurry to sell. Others add on thousands to the estimated market value "just to see what happens." If you want to try that, and if you have the luxury of enough time to feel out the market, we will sit down with you and work out an advance schedule for lowering the price if necessary.

If there haven't been many prospects viewing your home after three or four weeks, you may need to adjust the list price. If that doesn't bring any prospective buyers, you may need to lower your list price again. Plan on doing that regularly until you find a level that attracts buyers. Making a written schedule in advance will help.

No Sale- Consider the Costs

The greatest hindrance to selling property is to be priced inaccurately high. When thinking about what you need to get, look at the sold sales data, and consider what it costs you to hang onto the property while you try to get a few thousand dollars more. Things like mortgage payments, insurance, maintenance, utilities, and other recurring household expenses, really add up in six months or a year. Remember these costs when pricing your home too high.

Incentives Can Help Hasten a Sale

Sometimes cash incentives are as effective as lowering the price, especially in the lower price range if buyers are "cash poor." You may offer to pay some or all of a buyer's closing costs.

You can offer an extra selling bonus to the broker who brings a buyer. If you haven't had much traffic through your house and you're in a hurry to sell, you may want to add the offer of a bonus to the selling broker, in addition to their commission. This encourages other companies to bring their buyers to see your home.

High or Low - Finding the Right Balance

When pricing your home, consider your buyer's frame of mind and other pricing factors:

If you set the price too high, your house won't be picked for viewing, even though it may be much nicer than other homes on the street. You may have told your REALTOR® to "Bring me any offer. Frankly, I'd take less." But compared to other houses for sale, your home simply looks too expensive to be considered.

If you price too low, you'll short-change yourself. Your house will sell promptly, yes, but you may make less on the sale than if you had set a higher price and waited for a buyer who was willing to pay it.

Heritage Real Estate has the experience to navigate you through pricing your home correctly. If you're ready to sell, ask us about a complimentary CMA.