How to Determine if Your Home is Overpriced
by Edward Hurley, guest contributing author.
So you own a great home that you’re really proud of? You love the interior and large spaces throughout the home, your kids love the school they go to, and the neighborhood is safe.
However, you found your dream home and want to sell your current home to someone who loves it as much as you did when you first saw it! You price it according to how you feel about it. It’s an amount that you see fit to get back everything you put into the home.
But how do you determine if your home is overpriced? If you are not sure how to price your home, here are some factors to help you determine the true value of your home.
What is Your Neighbor’s Home Worth?
By finding out your next-door neighbor’s home cost, you can better understand the value of your own home. If it’s a substantial amount lower than the price that you set for your home, then you may want to rework those figures to ensure that you are in balance with the homes nearest to yours.
Where is Your Home Located?
Take a look at your neighborhood. Consider everything from the curb appeal of your street to your school district to crime rates. How far are you away from entertainment or the nearest grocery store? Sure, these factors are out of your control, but unfortunately they still play a role in how much you can charge for your beloved real estate.
Even if you live in a beautiful home, the quality of the surrounding area will drastically affect your home’s value for better or for worse. There’s an old saying in real estate that you should, “buy the cheapest house in the nicest neighborhood.” This helps give you the biggest resale bang for your buck. When you have the nicest house in the crummiest neighborhood, the reverse happens; you have a tough time making all your money back in the resale. Depending upon what city your home is located in, you may want to adjust the value of your home sale price accordingly.
Have You Made Updates?
If you have not made updates to your home, you may want to start. Your home may be beautiful on the outside, but if you have not updated your 40-50 year old home since you first bought it, then you should consider fixing or renovating parts.
Even though items that you update may depreciate, even the most minor fixes to your home will add value to your open house. Do you really think people want to come to an open house to see that awful carpeting from 1955 still in the living room? No. So clearly, minor updates are not going to add much value to the home, but they will definitely help sell your home faster.
Don’t Simply Price According to What You Owe on Your Home
Everybody wants to make a profit off their real estate. It was supposed to be the biggest, best investment you’d ever made. But the truth is if the market’s not in your favor, you may have to bite the bullet on your asking price. 17% of home sellers must delay their plans to sell because they owe more on the home than it is worth. If you base your asking price on how much you still owe on the mortgage, you are almost certainly going to overprice your home!
Find a Trustworthy Agent
A lot of real estate agents will tell you exactly what you want to hear when it comes to the value of your home. They do this because they want to secure your business. The truth is however, they won’t be able to sell it at the price you have in mind. They’ll present low-ball offers to you and encourage you to accept even though you’ll be disappointed.
An overpriced home will NOT lure buyers, and you will limit yourself to a very narrow market. You need to find yourself a good agent who knows that setting a reasonable price around the market value is the best way to sell a home. Find an agent who is there to cooperate with you, listen to your input, and understand the true value of your home before you put it up for sale. He or she may not always tell you what you’re hoping to hear, but at least you can trust that your home will sell at the best possible (realistic) price.
Look at How Long Your Home Has Been on the Market
Did you list your home for what you thought to be a reasonable price and then watch it sit on the market? Has it been more than 30 days on the market? If so, your home is most likely overpriced, which could be why no one is trying to buy it.
What Can You Do?
There are many reasons why your home may not be sold as quickly as you would like it to be. The best advice to take from this is to find an agent who knows what they are doing. You do not want to work with an agent who tells you an astronomical value to make you believe your home is worth more than it is simply to get you to sign with that agent. You want to work with an agent who has experience, expertise, and honesty is the type of agent who will find you a great value for your home that is not overpriced among the other homes in your neighborhood. By pricing your home as accurately as possible, you will find buyers flocking into your open house and willing to make an offer.
Be sure to lower your home’s sales price if it is overpriced after you and your agent have closely examined the market in your neighborhood. By being honest, upfront, and pricing your home reasonably, you and your agent should be able to sell your home in no time! Just be sure not to step on any buyer’s toes . . . or wallets.
About the Author:
Today’s article, “How to Determine if Your Home is Overpriced” written by Edward Hurley as a guest author on Lynn Pineda’s Imagine Your House Real Estate Blog. Edward Hurley is a writer and social media representative for HouseHunt’s consumer as well as agent blog.
You’ll find Lynn selling homes in Southeast Florida in the cities of Coral Springs, Parkland, Margate, Tamarac, Coconut Creek, Boynton Beach, Delray Beach, Boca Raton, Sunrise, Plantation, Ft Lauderdale, Pembroke Pines and Miramar areas within Broward and Palm Beach counties.
Lynn Pineda, a licensed Southeast Florida Real Estate Agent serving Coral Springs Florida and surrounding Southeast Florida. Keller Williams Coral Springs Realty. March 10, 2015. Real Estate Promises Delivered. You can speak with Lynn by calling/texting her at 954-464-1100 or you can email her at: LynnP@ImagineYourHouse.com if you need to sell or buy your Southeast Florida home. Your local, trusted professional when it’s time to buy or sell your home. Real Estate promises delivered.