Step – 4 » Determine Your Home’s Asking Price
Lots of people out there want to buy your home. The right asking price will attract buyers’ attention, and pay you a maximum return.
You don’t want to set your price too low or too high.
Setting too low a price means you could miss out on thousands of dollars that some buyer would have happily paid.
Setting too high a price can scare away willing buyers and leave your home on the market for too long. When you lower the price, people may assume you are under pressure to sell, and lower their offers even further.
Your goal is fair market value.
“Market Value” is a term that simply means the maximum amount of money that interested buyers are willing to pay for your property. Remember, buyers comparison shop, especially for something as expensive as a home.
REALTORS® know the general factors affecting your market.
Maybe larger families are moving into your neighbourhood. This trend will make homes with three or more bedrooms and large yards more appealing than two bedroom bungalows. Perhaps a large employer is opening a plant nearby, which will increase demand for housing in general. How are interest rates affecting people’s willingness to take out big mortgages? Do people feel confident about their financial futures? Your REALTOR® knows the answer to these questions and, more importantly, how they affect the price of your home.
REALTORS® then calculate your home’s value within your market.
After accounting for general market influences, your REALTOR® will get very specific about your home, and perform what is called a “Comparative Market Analysis” (CMA). Using the extensive background information available only to REALTORS® through the MLS listing service, they will compare your home to a collection of similar homes that have recently been sold in your area. No two homes are the same, but REALTORS® are very good at adjusting their calculations according to the differences. Your REALTOR’S® suggested asking price is thoroughly researched, and designed to maximize attention and profit for your home. You can feel confident trusting their opinion.
Yes, first impressions matter.
It’s nearly impossible to replace the initial flurry of interest and activity a new listing will generate. REALTORS® in your area will want to see your home right away and tell their buyers all about it. Be sure you’re priced and poised to capitalize on this first wave of excitement.