Pricing your home to sell is a tricky process. You want it to sell quickly (or at least on your timeline), and you want it to sell for the most amount of money possible. However, if you price your home too high you may not get any offers and your home can remain on the market for months. Or, you may receive lowball offers from buyers wasting your time. But there are questions you can ask yourself to help determine if your asking price is above the mark.
1) Are you trying to recoup money you invested into upgrades? You think about all the money, time and effort you have put into making your house a beautiful home and you want this to translate into a dollar for dollar amount. Unfortunately, that doesn't happen. For example, a pool will usually only reap you half of what you paid. If you paid $20,000 for the pool, don't expect to be able to raise the price of your home by' that same $20,000 amount.
2) Are you pricing it to come up with the down payment needed for your next home? Your current home is only worth what someone else is willing to pay for it. The dollar amount that you need to get out of the sale has no bearing on what price your home is actually worth on the market. And if your home is priced significantly higher than similar home in the area, then you will be hard-pressed to find that buyer who will pay your asking price. Talk to a Real Estate professional about home sales in the area over the past six months. This will give you a good idea of what dollar figure you should reasonably price your home.
3) Are you getting any traffic? If your home has been on the market for more than a month and you have been getting very few interested parties to look at your home, you may be over-priced. You may just be priced right out of reach for a potential buyer's price range, or prospective buyers just think you are unreasonable in your price and therefore conclude that you will be an unreasonable seller to work with.
4) Are repairs needed? If there are significant repairs required on your home, your price may be too high for some buyers. Many buyers purchase a home just within their financial reach. They don't have much money left over for repairs and other incidentals. If your home hasn't been well maintained, or is in need of some remodeling or repairs, buyers may be wary of making an offer and getting in over their head.
5) Are offers coming in low? You may be receiving no offers, or perhaps very low offers if your home is priced too high. Buyers usually know the market and if they know your home is over-priced, they will choose to not make an offer or will make a lowball offer to see if you bite at it, especially if your home has been on the market for a long time.
6) How long has the property been for sale? The longer the property is on the market, the worse the chance for a sale becomes. Many properties languish on the market because they are too high-priced and buyers refuse to look or make an offer.
7) Have you had your property appraised? To get the best idea of how much your house is worth, think about getting your home professionally appraised. No bank will lend a buyer more money than your home is appraised at, so if you are priced well above the appraisal figure you will be hard pressed to find a buyer who will come up with the cash to pay off the difference.
8) Are there other homes in your neighborhood currently for sale? If similar homes in your neighborhood are for sale at prices significantly below your asking price, it's an indication that you are probably priced too high. And if those homes end up selling at that lower price, keep in mind that the value of your home has just been brought down, in keeping with that lower price.
9) Does your home have curb appeal? If your home is not aesthetically pleasing, you may be priced too high for buyers to even consider taking a closer look. Take an objective look at your property. Are the plants alive, the weeds pulled and the front of the house inviting to drivers-by? If you're home isn't a "looker" and you have no intention of cleaning it up for the sale, then you probably need to drop your price a bit. Cosmetic changes are just as important as the overall maintenance issues of a home and buyers don't want to pay top dollar for anything that looks like a fixer-upper.