Why is
it that some homes sit on the market for a year while
others sell like hot cakes? Frustrated sellers will blame
a bad market, while a good real estate professional will
tell you that many times, a slow sale is often attributed
to the listing price.
If a home is overpriced, buyers will stay away. But, if
the price is competitive with similar homes in the area
and “shows” better than the competition, it
will have a better chance of being sold quickly.
The secret is perfecting a technique that’s as American
as apple pie: comparative shopping.
Although comparing houses with different styles, square-footages
and locations is challenging, real estate professionals
still feel it’s one of the best methods to use when
determining a home’s market value.
A responsible real estate agent will effectively evaluate
a home’s worth through a process known as Comparative
Market Analysis (CMA). Taking a look at assets, such as
a swimming pool, bigger than normal living spaces, a fantastic
view, adjacent city parks and other attractions, the agent
will begin to compare your home with similar properties,
called “comparables,” that have sold in the
area within the last six months. Typically, it is a realistic
price range that will ensure you top dollar and a reasonably
quick sale.
However, factors such as the amount of time needed to
sell your home can alter my price recommendation dramatically.
I can determine the typical duration that listings are
on the market and can explain that the marketing “norms”
vary with prices and properties. Based on this criteria,
we will be able to sell your house for a price that both
you and the buyer will be happy with. However, if you’re
under time constraints because of unexpected job changes
or moving agreements you’ve made on another property,
this will narrow your chances of selling the home for
top dollar in the market.
Assuming you have sufficient time to market the home,
here are a few small steps you and your agent can take
to finding the right price for your property.
The best comparisons can be made with similar homes that
have been sold within the last 45 days as opposed to the
standard six months. Any longer and other factors, such
as the economy, could cloud your view of how much your
home is really worth.
Another good benchmark is to review the selling prices
of homes that have just been sold and are pending closes.
Most MLS services provide information on deals pending
that most real estate agents should be able to share with
you.
A good rule of thumb before setting a price is to make
20 comparisons of comparable properties within a one-mile
radius of your house. Once completed you can feel comfortable
that the price you’ve picked is a good gauge of
the home’s worth and won’t discourage qualified
buyers.
Being open and honest about what you see as the home’s
greatest strengths and biggest weaknesses will also help
me to get a better feel for how to best evaluate (or assess)
and market your home. Think of your home as if you were
the buyer. If your home is listed at the right price,
you’re well on your way to a speedy and fruitful
sale. Contact
us for more info on the challenges of pricing a home
in San Jose CA... |
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