Pricing Your Home to the Market

Pricing your home at the time of sale is as important as any other consideration you will make for your financial future. Your home's listing price will affect multiple considerations including the potential buyers that view your house and the ultimate profit you earn from the sale. There are many factors to discuss with your real estate agent during the pricing process. These include the state of the current market, the approximate value of your home and personal considerations you may be facing with the home's sale.

Seller's vs. Buyer's Market

If you are currently experiencing a seller's market when it comes time for you to list your home, you are in luck. This presents you with the greatest chance of earning a high profit. Several characteristics permeate a seller's market including these: a low volume of homes for sale, a low number of foreclosure and discount properties and a flexible credit market. With these factors, buyers will be able to gain financing easily and be willing to spend a little more on the right property. You can price your home to a more expensive listing than in a buyer's market.

A buyer's market is characterized by a drop in real estate pricing due to a high number of homes for sale, a large number of discount properties and even the inability to get an easy home loan. This means there will be more homes for sale than buyers looking to purchase. If you are listing in a buyer's market, consider whether it makes sense to wait for more favorable conditions. Otherwise, know you will have to list your home for a lower sales price than you would list in a seller's market. 

Comparing the Market to Your Home

You will want to discuss comparable homes and sales in your area with your real estate agent. A good agent will pull a list of recent sales of properties similar to your own before you even ask. The agent will look at the range of prices the homes were listed for and the range of prices the homes sold for. The agent will also consider how long it took each home to sell. You will want to ultimately sell at a price that suits the value of your property, and you will ideally like to do so as quickly as possible. Therefore, use the comparable sales to determine just how much your home may sell for and price just a bit higher. This leaves room for negotiation, which will inevitably occur.

Personal Considerations

If you still have a large chunk of mortgage to pay off, are already on contract for your next home or have other financial considerations, it is essential to share these with your agent. For example, if you know you must sell your home for at least $270,000 to pay off your mortgage and have money left for your next down payment, it would be unwise to list at $260,000. Your agent must be aware of your situation in order to best help you achieve your goals.

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