Pricing Your Home to Sell

By
Real Estate Agent with Long & Foster Realtors

I was at a real estate conference Wednesday put on by Howard Brinton’s Starpower group (www.GoStarPower.com) with a lot of top agents from around the country in places that have been experiencing a changing or “correcting” market for a lot longer than we have in the Washington, DC area.

 

They advise that sellers price their houses $1 below the most recent sales price of a similar property.  So a seller hoping to sell his or her house “as is” should price his house $1 less than the most recent and closest “as is” sale.  A spruced up house would be priced $1 less than the closest, similar spruced up house.

 

Leslie McDonnell, an agent in the Chicago area, gives here sellers a flyer outlining what a house is and is not worth.  Market value is not what a seller has in a house or needs out of it, what a seller wants, what the house has been appraised for in the past (even recently) or assessed by the property tax office, how much it’s insured for, what the rumor mill says the neighbor sold his house for, or how much houses cost where the seller is moving.

 

True market value is what a buyer is willing to pay based on today’s market, competition, financing, economic condition, location, normal marketing time, showing accessibility , and the buyer’s perception of the condition.

 

Sellers can’t control location, market or economic conditions, the motivation of their competition, or value.  They can control the price they ask, the condition of the property, and access to the property.

 

So, in order to be one of the properties that is selling in today’s market, McDonnell suggests improving the condition of a home dramatically, improving the way it shows, offering good terms, and adjusting the price to reflect great value.

 

I’m finding that the buyers I’ve been working with want a house in which they can live in long term (at least 5 years) in case it takes that long for the market to improve.  That means they are less willing to compromise with location, the number of bedrooms and baths, and other updates.  Sellers having a long term “deficiency”, such as only one bath, need to be in great condition and have a value price, one that gets the buyer to overlook the deficiency because the home is special in other ways.

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Anonymous
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Good advice.  I've got some Star Power agent interviews on CD and there's always something to learn.
Oct 15, 2007 08:31 AM #1
Rainmaker
76,036
Natalie Langford
Realty Negotiations - Winchester, VA
Winchester, VA Real Estate
Wow, thank you for sharing.  This is some great insight into the buyers minds. 
Oct 15, 2007 08:47 AM #2
Rainmaker
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Mike Klijanowicz
Baltimore & Harford County Maryland - RE/MAX AMERICAN DREAM - Perry Hall, MD
#1 Baltimore & Harford County Maryland REMAX Agent
Thanks for sharing this with us!  I was not at the conference, but feel like I still heard the important points because of this post!  Thanks again...
Oct 15, 2007 08:51 AM #3
Ambassador
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Charlie Ragonesi
AllMountainRealty.com - Big Canoe, GA
Homes - Big Canoe, Jasper, North Georgia Pros
Interesting Blog . What you are saying is we are going from flip this house to saty in this house.You may be on to something. We are a very mobile society and have gone from 1 house to move all around. Now with Telecommuting we may be going back to a more stationary way of life. You blog has me thinking along those lines
Oct 15, 2007 08:55 AM #4
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Sarah Toppins

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