Here’s how to price your home to sell in this crazy real estate market.
With fewer than 800 homes for sale in our market and an 11% average price increase over the last year, we’re clearly in a seller’s market. If you’re an eager home seller, you might be thinking that you can list your home at whatever price you want and buyers will come. That’s not quite accurate for a few different reasons.
First, most buyers will be getting a mortgage after visiting a lender and getting pre-approved. They’ll look at the buyer’s income, debt, and budget to figure out what kind of home they can afford based on a monthly payment. At this point, the buyer and their agent will start looking at homes that meet their criteria and are in their price range. If you’ve priced your home at $300,000, for example, and the buyer is qualified for $275,000, they aren’t even going to see your house. If they do, they’re going to want you to come down in price.
Additionally, if a buyer is qualified for that $300,000 but they see other homes priced the same with more features and benefits, they’re not going to bother buying your home because they’ll realize it’s overpriced.
Cash buyers aren’t concerned with getting a mortgage, but they have a budget, and they typically know a lot more about the market than the average buyer. They won’t overpay, either.
The appraisal can present issues as well, even if you do get someone to buy your overpriced home. When the appraisal comes in low, the loan isn’t going to get approved unless the buyer has cash or you’re willing to come down in price.
The best strategy in this market is to price slightly below what the home is worth. This is going to lead to multiple offers. You may have several buyers who recognize the value in your home. When they find they’re competing with others, they’re likely to bid over asking price to get the home in a competitive market like this. At that point, you’ll be able to decide on which offer is best for you.
If you have questions about the challenges of selling a home today or anything else related to real estate, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.