How much is my house worth?
Evaluating how much a house is worth can be a difficult question for homeowners selling a home. How do you decide what your home is worth? How do you decide how much to sell it for? Start off by gauging what’s important to you? Price and/or time? How much money do you NEED out of the house? How much is left on the mortgage? What do you intend to do with the stored equity from the sale of the home? How fast do you need to sell your house? Can you afford your mortgage? Do you need to move right away? Is the home vacant or not? A vacant home can be costing more money just by it sitting on the market. At times you want to price it considering how much money it will cost if you if it sits on the market for the desired amount of money you initially want. All these questions come into play.
The process of determining a home’s maximum value is ultimately determined by the market. It’s determined by what a likely buyer is willing to pay for it. You can help estimate that based on what similar homes are selling for in your neighborhood. Pricing your home above what similar homes are priced at only helps the other homes sell….not yours.
To take this one step further, take into consideration what the homes are actually closing for, not only the active list price. I come across a variety of clients who believe that because they love something, everyone else does do. It’s simply not the case. You may love first-floor condos, while many buyers prefer the top floor for the view and to avoid insects, while you may hate the stairs!
Let’s finalize this with a list of things to consider.
Inventory- How many homes are on the market for your neighborhood? This is a huge factor. You may have bought the home at $200,000 while there were only 10 homes on the market in your community but 5 years later there are 25 homes on the market in the same community. The simple concept of supply and demand comes into play here. A large supply of homes in relation to buyers reflects on home prices. As well as low inventory drives the price of homes up.
Don’t exclude the inventory of similar neighborhoods in the same area. With one of my listings, I found that the challenge did not only do our inventory reach of an all-time high of forty-one homes vs a high of seventeen back in 2015. I found that there was a community Naples Heritage with the exact same condos in the same area. This gave buyers a TON OF OPTIONS! That reflected in the price and absorption rate (how long it takes to sell a home) in the Cedar Hammock community where the listing was located.
Text the code DEMO48432 to 35620 for a quick mobile demonstration of how I market homes uniquely automatically sent your phone.
Absorption rate- Absorption rate is a concept that many people selling a home and REALTORS fail to take into consideration. Absorption rate more or less is how long the inventory in a particular market will last. So, for example, Cedar Hammock had 27 homes active in November with 3 homes selling a month. With no active homes coming onto the market, that would be a 9-month inventory. If you expect to sell a home before the 9 months, you’d have to price the home competitively.
Interest rates- This is a no-brainer, with interest rates low, buyers can qualify for more homes and more buyers are on the market. The greater demand by buyers drives the value of homes up, while high-interest rates drive the rate of buyers down and your home price as well.
Condition- Does your home need cleaning, de-odorized, painting…etc? Again, if your home is priced at $200,000 in desperate need of painting and cleaning, while your neighbor across the street is selling a home of the same floor plan is clean and ready to go at the same price, who do you think a buyer will go with? You’ll have to either address the condition of your home or price the home at a lesser price to reflect the condition. In addition to condition, whether or not your home has upgrades are not is something to consider as well. Most buyers don’t want to do any work. If your home needs upgrades, expect buyers to look elsewhere unless your price is appealing enough for them to overlook the needed work. Buyers are looking for fresh paint, clean/newer flooring, new appliances, and an updated kitchen and/or bathrooms. These are a few of the relatively safe ways to upgrade a home and get a good return on the investment.
Price- Take into consideration internet pricing for example, 200,000, 225,000 250,000 etc.
Think about the way people begin a search online. So, for instance, when people are looking for a home on the low end of the price spectrum, they’ll look for a house up to $200,000. So, if you're priced at 199,000. That’s great. But what about the people you are looking for a house from 200,000-225,000. You totally have missed that part of the market. Price your home so that it appeals to the highest amount of people based on how they search online. 200,000 gets people who max at 200,000 while also being noticed by people who start at 200,000 as their search.
Also as realtors are sending properties to their clients by automated processes, your home can be missed by their inventory of buyers because of your odd pricing.
Pricing a home is more of an art than a science. Each home is unique and may require a unique marketing approach as well as a unique qualification to justify its pricing. A licensed REALTOR can help you with pricing your home and most will offer a consultation with no charge. So don’t hesitate to speak to a REALTOR today and ask “ How much is my house worth? ”
As a Coldwell Banker Real Estate Professional, I’m also able to look at the buyer profile for a particular zip code. What does that mean? We pull data on the hobbies, age, and income of a particular community, and the top 3 locations that move to your area and target our ads toward people that match that profile, it optimizes your sale by reaching the right people rather than blindly advertising.
Click here for the free guide "Selling A House Made Simple"
My marketing plan is aggressive, I utilize lead capturing technology to rapidly respond to buyers. For a Mobile Demonstration by cell phone of how my marketing plan can sell homes more effectively than most, text the code DEMO48432 to the phone number 35620
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24031 S Tamiami Trl Ste 101
Bonita Springs, FL 34134