What Should The List Price Of My Home Be?
When it comes to pricing, it is best to consult with a knowledgeable, local real estate expert. A real estate agent will look at what recent sales have occurred within your market, factor in your home’s condition compared to those recent sales, and keep an eye on the current market conditions to give you the best price for your home.
Keep in mind, pricing is not an exact science. Most pricing is an art and a science. Yes, agents use formulas and calculations to determine their opinion of value but good agents also use their understanding of the market and the area to determine the best list price to generate you the best sale price.
It might seem counterintuitive, but the lower average list price actually results in the highest average sale price. Why? All buying activity in any area of life involves both an emotional decision and a rational decision. Emotionally – how does the house feel? Does it feel right, can the buyer envision themselves living in the home, etc… Rationally – how does the price compare to the other homes they have seen. If a home emotionally fits and rationally makes sense, I guarantee you will get an offer on your home, potentially multiple offers.
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A good agent takes all of this into account along with the psychology of pricing. Most consumers think in easy numbers and also have benchmark prices. For example, our brains are wired to see $249,999 and think $250,000. For benchmarks, buyers often search in $25,000 increments so $300,000-$325,000 or $425,000-$450,000, for example. An understanding of how pricing causes a buyer to rationally react makes a significant difference in the end result for the seller.
Finally, do not trust online valuations like Zillow. Even Zillow’s own CEO sold his home for $700,000 less than what the “Zestimate” was. Those algorithms can be right, but they factor ONLY rational data into a price. There is much more to it than that.
Bottom line, find a real estate agent you can trust and let them advise you on the right price for your home.