Setting the Price
Setting the price of your FSBO is one of the hardest parts of selling your home. To help you make the most informed decision, the Coach has provided a very valuable article on setting the price for your home. Request your copy of “ Setting the Right Price for Your Home”.
Market Analysis vs. Appraisal: What’s the Difference?
A market analysis is usually performed by a real estate agent. He uses comparable properties (active, pending, expireds, solds) to come up with what the “market” states the value of the home is. If you are ready to list, the agent should visit the actual property in order to look for unique features about the home which affects its value when compared to other homes that are similar in size, condition, features and location.
An appraisal is performed by a licensed appraiser. The appraiser sets an exact value of the property in a specific instance of time (e.g., Monday, August 15, 2010). He should check the value of the home using three methods:
1. Market Analysis
2. Replacement Cost
3. Best Use (if current zoning allows, would it be worth more if, instead of a house, there was a shopping center there)
How To Find the Tax Records for Use in Pricing Your Home
Here’s a link to the online database of tax records for your convenience. These records should show you sales of all the properties in your area, not just those that are similar to yours. The downside of tax records is they are usually woefully dated; it can take three to six months before a sale is put into the public records. You may be able to view the properties on a map which can help you understand how those sales may affect you.
Property Investment Profile
For an even easier resource, sign up for my free Property Investment Profile where you’ll get up-to-date MLS data that covers all the property details. It can even be set up to automatically alert you every 7 days. Click Here to do it! Once it arrives, go to 'Understanding My PIP' in the Resources section for a detailed explanation of what you receive.
Market Tracker
My Market Tracker can provide you with Market Trends for your zip code (and even those close by if you request them). This report will show you the number of listings during the past month and Year to Date, how sales are going, and even break down a lot of data into the various price levels. Click Here to Request It! Once you receive it go to 'Understanding the Market Tracker' for a detailed explanation of what the report is telling you.
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If the Market says it will sell for $300,000, and you want 350K, why not ask 500K? It's not going to sell anyway...
While subjectivity does come to play into how much people will pay, it is a very minor part of the process. People tend to look at several houses and if your home is overpriced, yours will sell the 'other house' the buyer sees.
Don't Chase the Price Down!
In this market, there are hundreds of examples of sellers who thought they could get more than the market would bear, and by the time they decided to lower the price, it was too late to get what the home should have sold for in the first place... |
