Summary: The following tried-and-true tips will help you properly value your home, determine whether you’re in a seller’s or buyer’s market, and then finally, what to do with that information in order to sell it as quickly as possible.
How to Price Your Home for a Quick Sale
Life has a way of throwing you curveballs. Some of them force your hand and some of them are once in a lifetime opportunities. Whether you land that dream job in a different city or you simply need to get your hands on some cash; how do you price your home for a quick sale?
(Please keep in mind that “quick” is a very relative term in the real estate industry. A streamlined, nothing-goes-wrong home sale can still take anywhere from 30-45 days to complete.)
Determine Market Price: How to Sell a House Fast
The first step in selling a home as quickly as possible is to find out the price of other homes in your area. These are referred to as “comps”, which is real estate lingo for “comparables.” The info found within local comps will reveal which homes are currently listed and at what price they’ve sold their homes in the past three months.
To do that, sometimes referred to as “pulling comps”, you have to pull listing and sales prices on homes that are comparable to yours. That means they are of similar age and size and are located within a half-mile radius of your address.
Home Selling Tips – Tip 1: Using recent sales of homes that are comparable in age, location and size is the best way to value your home. They will show you what buyers are looking for and how much they’re willing to pay for it.
If you hire a real estate agent, they can pull comps for you and will often present them as a CMA (Comparative Market Analysis.)
You can also hire an appraiser who will come do a tour of your home and will then put together a 10-page report valuing your property based on market comparables. The report costs between $300-400 and takes the appraiser about a week to finish.
If neither of these options is fast enough for you, you can determine market value by searching for sales and listings on websites such as Zillow.com and Trulia.com. Redfin.com also offers a free home value estimate based on your address.
However, be aware that home values and estimates listed on these sites can be inflated and/or outdated. Relying on sites such as these as your sole source of information would not be recommended.
Determine Market Environment
Is it a buyer’s market or a seller’s market? This is an important question to answer because it will dictate what you do with the information you’ve collected about your property and the market.
• Seller’s Market
A seller’s market is when homes are selling quickly (i.e. within 30 days of listing) and at prices above asking. If you’re selling in this environment, you have the advantage and might even receive multiple bids.
• Buyer’s Market
A buyer’s market is when homes sell more than 30 days after the original listing date for prices below asking. In this environment, the buyer has the advantage because the supply of homes for sale exceeds the demand.
This information can be determined by deciphering the market comparables you’ve pulled. Jot down the listing and sales dates and prices. Check the current listings in your areas to see how long they’ve been on the market and note whether sellers have had to reduce their listing price.
Price Your House to Sell Fast
Selling a home quickly comes down to a fair price and exposure. If you’re selling your home in a seller’s market, price it at market value. You want as many people to see your listing as possible and studies have shown that 60% of potential buyers look for homes priced at market value. There is also the issue of price range. Most buyers look for houses online using research websites and filter results based on their price range. If you overprice your home by even 10%, potential buyers won’t even know your home is for sale.
Home Selling Tips – Tip 2: If you’re selling your home in a seller’s market, take advantage of the frustration buyers may be feeling at being constantly outbid. They’ll be pleasantly surprised by a home listed at market value and will be highly motivated to put in an offer quickly.
Whatever you do, don’t underprice your property. If you’re in a seller’s market and your house is priced below market value, buyers will assume there’s something wrong with the property and discount it immediately. Even worse, they will assume you’re so desperate to sell, that they will send in a low-ball offer.
If you’re in a buyer’s market, where there is more supply than demand and most houses are selling more than 30 days after listing, you should consider pricing your home at 15% below market value. Studies have shown that pricing your home this way will capture the interest of 90% of buyers and will indicate you’re motivated to sell.
Selling a home For Sale By Owner also known as FSBO can be tricky but in today’s world, there are more marketing opportunities than ever. Create a FSBO marketing package to maximize your chances of selling your home.