When you decide to sell your home yourself, you’re taking on the job normally handled by an agent. Your first task, a crucial one, is setting the asking price.
Price it too high and your home could languish on the market, causing buyers to wonder what’s wrong with it and forcing you to backtrack on price, perhaps multiple times. Set the price too low and you may sell fast, but get that sinking feeling that you could have sold for more. Here are a few tips.
Check previous sales. Your home will sell for what buyers are willing and able to pay for it so you need to get an idea of market value through comparable prices in your area. Also known as “comps,” these are the prices for homes in your area that have either sold in the last few months or are still for sale. The Comparative Market Analysis is a key element in what real estate agents offer their clients.
Ask an agent. Do you have a friend or family member in the business? Ask them to pull the comps for you. This does not in any way obligate you to use them as an agent. However, you could offer to pay them a 3 percent commission for bringing you a qualified buyer. This won’t reap the full benefit of selling by owner, but you may get a buyer more quickly on top of getting a solid Comparative Market Analysis.
Check county records. County governments often offer online access to home sale records. However, this will not give you one key piece of information: “days on market,” which tells you how long it took a house to sell. Nor will it give information about any price reductions along the way. The number of days on market is a good determination of not only overall market condition, but also whether the particular home started off at a good asking price.
Check online sites. Check online sites such as Zillow to find the prices of homes currently on the market in your area. This will give you an idea of your competition. One caveat on homes currently on the market: Although their pricing will give you a good feel for the market, sellers can price their homes as they wish, regardless of what a knowledgeable agent might recommend. The contracted sales prices is the last word on value.
Hire an appraiser. An appraiser will give you a professional assessment of your home’s value. The few hundred dollars could be money well spent. Once you are under contract, the buyer’s lender will send a professional appraiser to establish an official value of your home. You may be able to offer the lender the appraisal you had done instead. They may or may not accept it, but you’ll have peace of mind knowing the two appraisals should be close in value.
Account for upgrades. If you have upgraded your home, this may add value to your home or at least enhance the saleability of the property. Nice granite counters, recent appliance upgrades, and a fresh coat of paint — all things that make a home move-in ready — will help sell your home more quickly and for a good price. High-value items such as built-in pools, expensive landscaping or technology systems may not translate into a higher sales price.
On the other hand, if you have a dated kitchen, for example, a buyer will mentally add up these costs and make a lower offer.
There may be other factors that add value to your home, such as the reputation of the neighborhood and schools, the location of mass transit, shopping and restaurants. They may not add in terms of dollars, but can be used as selling points to move the buyer your way in negotiations.