Thinking of Selling? (Part 2)
For-Sale-By-Owner (FSBO) vs. Listing with a REALTOR®,
Accurately Pricing Your Home – What’s my home worth?
The single most important aspect of selling your home is price. Price it too low, and you’ve left thousand of dollars on the table; price it too high and you’ll run into problems with the appraisal and buyer’s financing (mortgage lenders require that the home appraise at or above the purchase price). When determining the price at which you will offer your home, there are a few things to consider:
Size (square footage of livable space, # bedrooms/bathrooms, yard)
Age and condition
Location, location, location
The best way to accurately price your home is to see what homes similar to yours in size, age, condition and location (comparable sales) have sold for in the past 3 months. This is the means by which appraisers and real estate agents arrive at an opinion of value.
To determine the value of your home in today’s market, you can do one of two things:
Hire an Appraiser ($300 - $500)
Research recent sales data at the courthouse (time consuming!)
Keep in mind that a home is only worth what a buyer is willing to pay for it – that is why the concept of “comparable sales” is so important!
…by listing with a REALTOR®…you don’t have to hire an appraiser to get an accurate opinion of value – we use the same records as appraisers do to research comparable sales. You also won’t be sitting in a courthouse vault sifting through real estate records. You’ll be relying on the opinion of an informed professional who lives and breathes the market every day.
Recently, I was working with some buyers who just couldn’t find the right house to fit their needs. After 4 months of searching, I drove past a FSBO that had the exterior features my clients were looking for. I suspected it would be out of my clients’ price range, but after speaking with the owner, I arranged a showing. It turned out to be just the home they’d been searching for, and we quickly negotiated a purchase price. As part of the mortgage process, an appraisal was ordered. The appraisal revealed that the value of the home was $23,000 more than the purchase price! This was great news for my buyers, but the seller left a ton of money on the table. Moral of the story: if the seller had listed with a REALTOR®, 1) the home would have been priced accurately, leaving the seller with more money even after paying the REALTOR® fee 2) the home would have sold in 2 months instead of 7 months, and 3) the seller wouldn’t have dealt with phone calls from tire-kickers, low-ballers and agents trying to list the house.
Thank you to fellow Coldwell Banker agent Rachel Anker-Johnson from the team of Coldwell banker Townside office for this great blog.