Jonson Tran Nguyen
Broker Associate - Realtor
168 Las Tunas Drive, #105
Arcadia, CA 91007
How to Price Your Home
When preparing your home to be on the market, consider the following factors that will influence the value of your home
The ten main factors that influence the value of your home are:
1. Interest rates: The lower the interest rates, the more buyers can afford to pay.
2. Supply and demand: If there are many homes similar to yours on the market, they are considered as your competition. Figuring out ways that you can do to set your home apart and make it more desirable for buyers will beat the competition. On the other hand, a small number for sales can result in competing bids that will send home prices up.
3. Economy: Is the economy improving or sliding? This will affect the buyers’ confidence in their ability to manage the mortgage payments.
4. Location: Are you in a desirable neighborhood? Are there factors that make your neighborhood less desirable? For example, low rating schools or traffic problems?
5. Condition: Have you kept up with repairs and features of the home? Is the house clean? Does your house make a good first impression? How much can you reasonably do to fix it up for sale?
6. Timing: Do you need to sell quickly or do you have time?
7. Size: Will your home appeal to a growing family or to those who are downsizing?
8. Amenities: Does it include features that are popular, such as low-maintenance landscaping, hardwood floors or granite counter tops?
9. Terms: How flexible are you with terms to the sale? What’s excluded? Have you considered offering financing? Carrying financing can make your home very appealing to buyers and help you sell for maximum price.
10. Attitude: How committed are you to selling now? Do you really have to sell or are you just testing the market?
To determine your home’s value:
- Research the housing market in your area. Browse the Internet, local newspaper ads and free For Sale publications. Visit open houses in your neighborhood to get a general idea of the current market.
- Get a comparative market analysis (CMA) from a REALTOR®. A CMA compares homes that are currently available and those that have sold in your neighborhood in the past year. The more similar the features like square footage, number of rooms, lot size, etc. and the more recent the data, the more accurately it reflects the current market. Don’t confuse listing price with sold.
- Have your home appraised. An appraisal estimates your home’s market value. A lender will require an appraisal to finance a prospective buyer. For residential properties, a professional appraiser will either compare your home to similar properties that have sold in the area or, for new properties, estimate how much it would cost to replace the existing structure if it was destroyed.
What’s the right price?
Generally, aim for your list price to be within 2 to 5 percent of what you expect the selling price to be. Pricing strategies vary with the market. If it’s slow-moving, price lower. If it’s active, price close to your expected selling price to stimulate competing offers.
Remember, your home is easiest to sell when it’s first listed. During the first couple of weeks, you’ll get a flood of interest on the part of agents eager to preview it for their clients. If you price it too high and they can’t sell it, your home may remain on the market and become old news. When properties are on the market for a long period of time, prospective buyers may think you’re becoming desperate and lower their offers. As a result, you could end up having to accept less than you normally would have received if you priced it at the right price to begin with.