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Along with location and condition, the pricing of a house is a major component
of the reasons why a house will--or will not--sell quickly. Although the pricing should not be dealt with lightly,
some sellers have a tendency to put too much emphasis on the price and not enough on the condition, ending up with
a house that is overpriced for its current condition.
If you are selling a house with an Agent, in all likelihood the Agent will have data to help set a price, as well
as suggestions about a pricing strategy. If you are selling your house on your own, it is important that you gather
relevant data when making a pricing decision. Many buyers will just naturally expect you to sell your house for
less than those listed by Real Estate Agencies (you are, they will reason, saving the commission, so you should
give it to them!) so having up-to-date data available will help to back up your selling price.
 Price it right from the start
Care and time should be taken when establishing the original listing
price for several reasons:
- If the house is overpriced, it won't sell. If it doesn't sell and sits on the market the listing quickly
becomes stale (and then takes even longer to sell!)
- If you overprice the house with the intention of reducing the price
later just to "see what the market will bear", when the price of the house is lowered, it signals to
buyers that it was (and still may be) overpriced. This strategy, then, can often backfire.
- If the house is underpriced, it most likely will sell quickly--to the detriment of your net proceeds.
Some factors that affect the price
- Location: You can't
get away from this one. If your house is located in a desirable area that is in demand, you will be able to get
a higher price than the same house in a less desirable area.
- Condition: A house
that has been better maintained and shows better will always sell for more than one that has had deferred (neglected)
maintenance and needs work.
- Desirable amenities:
If a house has amenities that are currently popular in the marketplace, it will bring a higher price.
Methods of setting the price
There is no "scientific" method of setting a price when you
are selling real estate, but their are a couple of methods that will take the guesswork (and the emotion) out of
doing it. Note that neither of these are based on the "I just know what it is worth!" method.
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