How Do You Price a Home?

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Donna Burke

Sellers always argue the price of their home.  One thing that we can count on is that buyers want to buy low and sellers want to sell high.  When we price a home we look at active listings (supply and demand), expired listings (failed to sell), and sold listings (which is most valuabe).  Of course not all homes are alike so we first the price on sold listings.  We try to use homes that sold recently (never more than a year ago), homes that have the same features, homes that are in the same subdivision, homes with similiar square footage, and homes that are in the same condition.  We choose at least 3 comparables.  Then we average the price per square foot and multiply that by the square footage of the subject property.

I recently challenged the seller because there was a house down the street that was on the golf course and it was a two story.  Her home was a 5 bedroom backing to another home.  In Windrose a golf course lot adds about 20K so that can not be used.  Also we do not compare one stories to two stories.  Her reason for her price was that the two houses were close to each other.  Obviously that is no basis for price.  I finally did a spread sheet to explain value so she reduced her price to the correct price and now she has abundant showings.  The point is that buyers are well educated and have tons of information at their fingertips.  Pricing a house is not an exact science but we can get pretty close!

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Post Category: Home Selling, Housing Market, Home Marketing

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