What you need to do to Sell a home.
Imagine…just one thing to do when trying to sell your home. What could it be?
Could it really be that simple? We all like simplicity. Yet, why do we sometimes fight simplicity, where we ultimately end up muddying the waters instead? What gets in the way? Let me light the way with the big reveal of what that one thing is come home selling time, so we can get your home sold.
The big reveal.
That one thing.
Before I get to it, let me explain to you that this applies to the home that’s in pristine condition, the home in need of repairs, the home that backs up to a busy street and just about any home. Yes, any home. This one thing that you need to do to sell a home will apply to you, as a homeowner wanting to sell a home.
What is the one thing?
Pricing your home right.
Yes, that’s right, pricing your home right is the one thing you need to do to sell a home.
Is that it?! Now, you’re thinking; “…well, I can do that…I know what my home is worth…”. SCREECH. HOLD ON. HALT. Before you get too far ahead of yourself, let me explain to you in great detail the effects of pricing your home right and what is analyzed to come up with the right price to list a home, to get a home sold. What are the variables and how will they affect your home and its list price. This is the point, in which, you need to push aside and don’t let get in your way; your personal feelings, your emotions and all those wonderful memories of your home that you feel adds up to your home’s worth.
Instead, we need to look at what the local area Real Estate market reveals; this is what will set the price for your home. What will a prospective home buyer be willing to pay for the home you are selling? Buyers actions to home buying in your neighborhood will detail what homes will sell for in your area and unfortunately, it’s not about what you feel is the correct selling price for your home. All too often, this is one of the most difficult results for any home Seller to understand and wrap their arms around. Hopefully, once I further explain here, you’ll grasp the concept better.
What criteria is used to select the homes used to compare to your home?
Before we analyze the homes to be used to compare to your home to come up with a list price, we first need to determine the criteria that is used to gather up the suitable homes to be analyzed.
Where your home is located is key. We will look at homes that are roughly a mile from your home. I say roughly because sometimes we aren’t able to find homes to analyze that are within a mile radius from your home, so we may need to expand our search to find homes to use. If we can find recent home sales all within your neighborhood, even better.
If your home is a 4 bedroom home, then we should be looking at 4 bedroom homes as comparison, unless we’re unable to find a 4 bedroom home that had sold within close proximity, in the same school zone or with a close square footage. When you can’t find enough suitable comparables, then you can consider different sized bedrooms and adjust for the extra bedroom plus or minus.
It’s best to look for homes with square footage that is within range of your home. Typically, the variance can fluctuate from an additional 300 to 500 square foot. You aren’t going to be looking at homes whose square footage are more than 500 as your numbers can become skewed. However, this may vary in your neighborhood – be sure to check with your local, trusted REALTORⓇ to see what your local guidelines are used.
Important note: you can never price a home simply by calculating square footage as there are way too many variables that fall within the differing square footage. One square footage calculation can detail an upgraded home and another square footage calculation would detail a home with needed repairs; hardly a comparison of apples to apples. Read more here about the errors inherent in square foot calculations; Pricing a home simply by a home’s square footage is inaccurate in so many ways.
When choosing homes to compare to your home, ideally its best to chose those homes that sold within the last 3 months, however that’s not always an easy task if not enough comparable homes sold within the last three months. When you do not have sufficient homes to compare to, sales dates will be pushed back month by month to typically no more than 6 months. Looking back to homes sold 12 months ago will not provide typically reads on the current market. Choosing differing bedroom sizes and making adjustments for the number of bedrooms may provide more choices so as not to have to go back too many months when different market conditions can prevail.
School zones play an integral part in home values. Home values can fluctuate from one school zone to another. Ideally, we want to compare homes that are in the same school zone as your home.
What homes will be analyzed to get to the right price to sell a home?
Homes recently sold
One of the best indicators of a home’s current value is when we look at homes that have recently sold within your home’s area that are most like your home.
Homes recently sold are the best indication of what a home Buyer is willing to pay for a home.
Homes currently under contract yet not closed
Homes that have received an offer from a Buyer and are no longer active for sale will be reviewed. While the home is under contract, unfortunately we do not know what the Buyer has offered to purchase the home for and will not know until the home actually closes and then becomes a closed sale; those discussed above.
Looking at the list price of the home when it went under contract can be a good indication of a home’s comparable value.
Homes actively for sale
Looking at homes that are on the market for sale, lets you see what homes you’ll be competing with in order to get your home sold. Survival of the fittest can apply here when selling a home…so to speak; let the best home win! You want your home to be priced just right in order to compete with the competition. Price it wrong and watch your competition win the Buyer that could have been a Buyer for your home.
What adjustments will be made to get homes all in line with one another?
If needed, adjustments will be made when the “perfect” comparable isn’t available, which can be quite common. Some homes, including yours, may have a pool, located on a waterfront or perhaps been updated with impact windows/doors and updated light fixtures, for example. These features will require an adjustment and dependent upon whether your home has such a feature will determine whether or not it would be an positive or negative adjustment.
Additionally, sometimes a home was sold where the home Seller agreed to contribute money to the buyer at closing in the form of a seller’s contribution; such a contribution would need to be adjusted from the home’s selling price.
Upgraded homes can be upgraded too much for the neighborhood which will result in disappointments for the homeowner. Over the top improved homes, will likely not reap the increase the homeowners were hoping for come sale time. They can end up over improving their home for the neighborhood. It’s always best to consider your neighborhood when installing any type of upgrade. Being a King of the Castle is not ideal.
How can the final selected list price affect which prospective home Buyers actually view your home?
This point is actually quite monumental, in fact. The final list price can either reel in the right home Buyers or miss them entirely. You should consider various price points of where you’ll place your home to make sure you’re appealing to the most Buyers possible for your price point.
Also, do you think that by using those 999 dollars you’re really presenting your home as a bargain at 999 or are you missing out on a Buyer who is starting their home search on a whole number? Hmmm. I got you thinking didn’t I?!
Talk with your Real Estate Agent about the closed sale price points in your area and where are the concentrated number of homes selling? If you’re seeing most homes sell within the $300,000-$350,000 range, wouldn’t it be beneficial to list your home for sale at $300,000 opposed to $299,999? Why would you want to risk Buyers seeing your home?
Now, that we’ve gone through just how we analyze your local Real Estate market to determine your home’s selling price, it likely makes a bit more sense how any home can be sold, if it’s priced accurately.
At the start of my article, I stated that all different types of homes can get sold with the right price, as long as they are priced according to their very specific condition; those needing repairs, backed up to train tracks and upgraded (watch those over improvements). If your home needs to be painted and the carpeting taken out, you price it according. If your home backs up to a busy road, again….you price it accordingly. It really is that simple.
With all this being said, I’m wrapping this up asserting that pricing your home right is what is needed to get the home you have to sell, sold. Let this seed, this one thing, take root and you’ll be well on your way to getting your home sold, whether you’re selling a home in Boca Raton or you’re that person who has a home way out in Timbuktu!
Accompanying Articles for additional reference
Begging for more informative Real Estate articles on pricing a home for sale from the qualified Real Estate Agents that have the task of doing the pricing? Great…take a look at the articles I referenced below:
Correct way to price a home by Karen Highland
Pricing mistakes to avoid by Kyle Hiscock
Process for choosing comparable homes by Tom Horn
Price a home to sell by Jeff Nelson
Pricing Myths by John Cunningham
A list price’s importance by Lynn Pineda eXp Realty Boca Raton Florida
Today’s Real Estate article “What’s the One thing you Need to do to Sell a Home?” was written by Lynn Pineda. You’ll find Lynn selling homes in Southeast Florida in the cities of Boca Raton, Boynton Beach, Coral Springs, Delray Beach, Coconut Creek, Deerfield Beach, Margate, Parkland, Pompano Beach, Tamarac, Sunrise, Plantation, Pembroke Pines and Ft Lauderdale areas within Broward and Palm Beach counties.
Lynn Pineda, a licensed Southeast Florida Real Estate Agent serving Southeast Florida since 2005. Excited to be part of the trend setting Real Estate Brokerage; eXp Realty.
You can speak with Lynn by calling/texting her at 954-464-1100 or you can email her at: LynnP@ImagineYourHouse.com if you need to buy or sell a Southeast Florida home. Your local, trusted professional when it’s time to buy or sell a home. Real Estate promises delivered.