Choosing the right price for your home is crucial to making a sale. You risk everything if your price is too far off the current market. You don’t want to discourage buyers because you are pricing too high and you don’t want to throw away equity because of a low asking price.

Although this part will take a little work you will be better prepared and have an easier time finding a buyer if you do your homework. Real estate agents are familiar with the current market – what houses are selling for as well as how your home compares to others on the market. You will need a few weekends to get a solid feel for the market in your area.

Where do you begin?

Stay Local

You need to see what similar homes are selling for in your area. Your area is crucial – a similar home in another area of town is not consequential to your pricing. Look in the paper and for sale signs on the streets in your immediate area. 

Do not ask for a free estimate from a real estate agent. Not only is it unfair to ask them for that information when you don’t plan to work with them, but you will not know if they are new and their pricing unrealistic or if they’re giving you an inflated price to get your business. Not that all agents would do that, but it is safer to work this out yourself if you are not planning on working with an agent.

Be Honest

Your home is valuable to you for many reasons. Children may have grown up in the home, marriages and anniversaries have been celebrated. Your dog may be buried in the backyard. This is, unfortunately, not a selling point for buyers.

Attend open houses in your area. Visit the homes on the market that are similar in age, size and style to yours.  Only take the information that is available when you are planning to sell since markets can change drastically from season to season.  Honestly take note of how yours compares.

Things to take note of are yard size, fencing, updated kitchen, bedroom sizes, type and monthly cost of heating (especially in climates with cold whether), if it needs a paint job (inside or out), distance to schools or shopping and if the financing is being assisted.

If you are selling a condominium you can also consider how the view, amenities, strata fees and regulations compare to yours.

Ask how long the home has been on the market. A home that is not moving in a strong market may be asking too much.  Do not use this home for your comparison.

Compare several homes to your own. Start with their pricing and add or subtract depending on if you are missing a feature or have a feature they don’t.  By working with several examples you should get a feel for right price.

You can also hire an independent appraiser to validate the pricing you’ve decided on. Whatever you do, do not aim too high or your home might sit too long on the market – buyers will know this and stay away
Pick the Best Price

You are probably aware of how stores price items with a .99 ending to entice buyers. Even though you know this (as does most everyone else) it works.

Keep that in mind when deciding on a price. If you are thinking of selling for $180,000 you will find more buyers if you price it at $179,900. Simple but effective.

Buyers will have a price range in mind when shopping. It’s better to be just below the $180,000 mark so you can take advantage of those looking in the $175,000 to $180,000 range rather than limiting it to those looking in the $180,000 to $190,000 range. You will still get the interest of buyers looking in the higher price range as people are always looking for a deal.

Now that you have decided on a price, you need to prepare your home for the market – that is, your prospective buyers. This area also requires some time and attention, but is well worth the effort of preparation.