A computer algorithm is no substitute for a live human who not can only check the accuracy of the basic data, but can also adjust for factors the computer can't see. Don't forget that buyers will be looking at these online estimates, though: They might question a list price that's far higher or lower. If you're thinking about selling, consider logging on to these sites and entering data about your house—this can sometimes correct algorithm errors, and anyone viewing your house will get a more accurate picture of your home's best features.
Local listings and open houses. Check the classifieds, look at listing websites such as those mentioned above, along with craigslist and other local marketplace sites , and visit local open houses to see what other sellers think is an appropriate list price for a comparable house.
Translating Market Value Into List Price After you and your agent have gathered all this information, you should be able to put a dollar figure—or at least an estimated range—on your home. When to Underprice Going lower than what's objectively rational for your list price is often a good strategy. Talk to a Lawyer Need a lawyer? Start here. Practice Area Please select Zip Code. How it Works Briefly tell us about your case Provide your contact information Choose attorneys to contact you.
Real Estate. Buying a House or Property. Selling a House. Mobile, Manufactured, and Tiny Homes. Homeowners: Taxes, Improvements, and More. Neighbor Law. Selling Your House. See All Real Estate Articles. You can see local market trends by checking the online resource realtor. As previously mentioned, many sellers think their home is worth more than it is. Because memories.
Because sentiment. Because pride. What makes your home special to you may not be something that entices them. Read: They may want to convert that craft room you worked so hard to perfect into a man cave. The lesson: As much as possible, set aside your emotional attachment to your home. In some markets, for example, it could make sense to price your home slightly below its fair market value to spark a bidding war.
Of course, there's no guarantee a pricing strategy such as this will pay off. Your home should be priced for its own local, or even hyper-local, market. Confer with your agent before you decide to try any market-specific pricing tactics. Pricing your home requires careful attention. In some cases, fair market value may not be precisely what you should list it for — and the reasons can be subtle. The idea is to maximize exposure. Not the sole decision maker in your household?
You can use this worksheet as a guide for that discussion. Homes generally sell for list price or less in a buyer's market. Adjust final sales prices upward or downward for lot size variances, configuration, and amenities or upgrades. Pull the history of any expired and withdrawn listings to determine whether any of them were taken off the market and relisted. Add these days on the market back to the listing time periods to arrive at an actual number of days the properties were on the market.
Look for patterns as to why they didn't sell, and note any common factors they might share. What brokerage had the listing? Was it a company that ordinarily sells everything it lists, or was it a discount brokerage that might not have spent sufficient money on marketing the home? Think about the steps you can take to prevent your home from becoming an expired listing , based on this information. The ultimate sales prices of homes that haven't sold yet are obviously unknown until the transactions close.
But that doesn't stop you from calling the listing agents and asking them to tell you how much a property is selling for. Some agents will tell you, and some won't. Again, make note of the days on the market. That can have a direct bearing on how long it will take before you see an offer. Examine the histories of these listings to determine price reductions. Bear in mind that sellers can ask whatever they want to ask for their homes. It doesn't necessarily mean that they'll actually get that price.
Tour these active-listing homes so you can see what buyers will see when they visit. Make note of what you like and dislike about the properties, as well as the general feeling you got when entering the homes.
These properties are your competition. Ask yourself why a buyer would or would not prefer your home over any of these others, then adjust your price accordingly. The buyer's lender will order an appraisal after you receive an offer, so you'll want to compare homes with similar square footage to come as close to the eventual appraised value as possible.
Comparable homes are those that are 1, to 2, square feet if your home is 2, square feet. Average square-foot cost doesn't mean that you can simply multiply your square footage by that number, at least not unless your home is average-sized. The price per square foot rises as the size decreases, and it decreases as the size increases. The next step after you've collected all of your data is to analyze it based on market conditions.
Your sales price might allow some wiggle room for negotiation in a buyer's market, but you'll want to be close enough to the last comparable sale to entice a buyer to tour your home.
You can ask more than the last comparable sale, and you'll likely get it if there's little inventory and there are many buyers. You might want to initially set your price at the last comparable sale in a balanced or neutral market , then adjust it for the market trend. Visit the Federal Housing Finance Agency's website if you feel that you're in over your head. It offers various tools to help you along, including a House Price Calculator that can help you add in factors for appreciation since the time you purchased the property.
If the appraisal for your home comes in lower than expected , the buyer can try to negotiate a lower sales price. The seller isn't required to reduce the sales price, but the buyer is free to walk away if they aren't happy with the difference between the appraised value and the sales price.
The seller could also ask for a second appraisal, but the buyer doesn't need to agree to this. The average price of a house in the U. You can see how average sales prices change every quarter by using this resource from the Federal Reserve Bank of St.
The average home price varies significantly by region.
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