House PricesThe Sellers Perspective
If you are selling your house, you want to know what your house is worth. Not only do you want to know, it is critical that you pick a price that is reasonable. Setting your house price to high is likely to lower the number of potential buyers that come to see it, and may significantly increase the amount of time it takes you to sell it - and these types of delays can easily cost you much more than the extra money you were trying to get in the sales price. There are many factors that going into setting a fair price, as follows:
The house and the property itself! Of course, this is a major factor. Things that matter a lot in the value of a house are the number of bedrooms, number of bathrooms, total number of rooms, a garage, a basement, an attic, total square footage of the house, and the overall age and condition of the house. Other key factors are the location of the house (is it on a busy street? Near good transportation or major highways? In a town with good schools? Near a beach or water?), and the condition and size of the lot. These are some of the most important factors, but many others come into play as well.
Market conditions play a large role in determinining house prices. This includes factors such as current demand for housing in your area, the time of year when you are trying to sell your house, and the current economic climate. It is important to pay attention to these types of factors. For example, you probably due not want to try and sell your house in November and December. This is usually a slow time in the market, and house values are depressed. If you can, its better to wait until the Spring selling season. Similarly, tough economic times will supress house prices. Of course, some people have no choice other than to sell in a tough climiate, but if you can wait for the market to pick up, its well worth it.
One of the most important steps to take in setting the price for your house is to check out the prices of recent house sales in your area. This information is publicly available, and can give you a real measure of what the current market will bear. Your real estake agent can help you get this information, and sit down and review it with you. You can also get this information at no cost from online services, such as HomeGain. Try to look at many different examples of other recent house sales, and take special note of the houses that are most similar to your own. Also take note of how recent the sale was and whether or not there have been changes in market conditions since the sale occurred.
Make use of experts. Your real estate agent and/or an appraiser are likely to be much more experienced than you are in determining a fair price for your house. Use an appraiser for a completely objective opinion. However, this option will cost a little money. Don't be afraid to rely on your real estate agent either. Your realtor gets paid a percentage of the sale, so they have every incentive to see the final price be as high as possible. An experienced agent will have seen hundreds, or even more, home sales. Let their experience work for you.
Put your biases on hold. Its your house. It can be hard to recognize that its true value, and you may feel that its twice as valuable as the house that sold just down the street. It can be hard to not personalize the transaction. But it is critical to put your biases on hold and look at the transaction unemotionally. Let the real data (the comparables) and the experts working with you (e.g. your realtor) be your guide. There is no win in over-pricing your house.
Make cost effective improvements. There may be many things that you can to to make your property more attractive and help get yourself a better value. Remember that a potential buyer's first impression is made before they even get inside the house. Having the outdoors look clean and attractive can be important in attracting a buyer, and ultimately play a role in the final purchase price. Consider some of the following:
Does the house need a fresh coat of paint?
Does the roof need to be repaired?
How often is the lawn cut?
Is there weeding to be done?
Is the trash out in open view?
Are the entryways clean and in good repair?
Does the yard need to be picked up?
Does the lawn need to be raked?
Look inside too. If the inside of ths house is in good repair, and reasonably neat, this also makes a good impression. Its hard for a house to look attractive if it also looks like a pit. Also, this may cause the buyer to feel that the house had not been cared for. These things may not affect how an appraiser determines the value of your house, but they may affect your purchase price, or how quickly you are able to make the sale.