Home Pricing Techniques
There are several methods in coming up with pricing your home. With any subject property, it is better to get as much information as possible from several different avenues of research.
Probably the most important method is the Comparative Market Analysis Approach which is used by appraisers. Although this method has its flaws it is the one that is used consistently throughout the State of South Carolina by licensed Real Estate Appraisers. Through tax records and sites like Trulia and Zillow you will be able to find comparables, which are similar properties of other homes in your neighborhood. Simply known as "Comps" by professionals, these must have been sold recently and you should be able to find similarities in how they compare to yours in terms of size, upkeep, and amenities. Try to be unbiased in your search and consider homes that are closest to your property. Remember, the difference in cost of brick vs. vinyl siding is very different from a construction perspective and is carried into an appraiser's consideration when determining value. The adjusted value will not always be consistent with the actual building cost. Also, be sure that these properties have actually sold for the price that it has been rumored to have sold for. Typically foreclosures and unique sales should not be used...but sometimes are. If in doubt hire an appraiser to get an appraisal report. For a few hundred dollars, a qualified appraiser can give you an opinion/estimate of your home's value. Many banks have lists of qualified and approved appraisers that they use and will not accept the appraisal unless they have a good relationship with that particular appraiser.
Other than the 'Comparative Market Analysis Approach', I highly recommend looking into your competition and preparing your home for sale. Research how many other houses are for sale in your area and what makes your house more desirable? I have been in houses that have been priced similarly but the buyer has offered less based on what he/she/they could get for the money. It is recommended to check out my list of pre-sale tips to see what you can do to make your house stand out.
There are also intangible features that you must consider. Consider contingencies of other homes compared to yours. Do you have special concerns that would affect the price you'll receive? For example, do you want to be able to move in six months while your neighbor is ready to move today? This is also a deciding factor in price. If a buyer is spending money they usually want it now. After all, Time is Money!
Know your bottom line and what you'll accept. It's critical to know what price you are able to accept before beginning a negotiation with a buyer. I've seen sellers try to squeeze every penny out of their home because they got caught up in the offer/counter-offer game when they really would have taken the initial offer. Sure a few hundred dollars extra would be nice but just don't get carried away and lose a potential buyer.
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