Plane*
This is another topic I have written about many times. Pricing a home for sale is not a science it is an art. Pricing it incorrectly is common. it was even worse a couple of years ago when prices were dropping quickly. Today the market is a little more stable so it is easier. A great starting point for pricing your own home is going back to 2001. Disagreeing with the price your agent suggested is normal and so is wanting more money for it than you can get.
What sellers fear the most is that they will not get the maximum amount possible for their home, or “what it is worth”. The sad truth is we will never know what anyone could have gotten for a home we only know what they actually got and no matter what we get we always want more.
It isn’t the real estate agents that sets the prices. Real estate companies do not set prices either. It is the buyers and the appraisers. I heard one of the idiot talking heads on a local news station say that an appraisal is required before a home can change hands. That is not true but before banks lend money to buyers and use the house for collateral they have it appraised. It the home does not appraise for as much as the borrower offered to pay for the home the lender says no.
Did this article help you price your home? It is possible that the only reason I wrote it is because I am tired of people making me out to be the bad guy if they don’t like the price.
Also see: The truth about real estate companies
Local market conditions and home prices – real estate is local
*the plane has nothing to do with pricing a home. I just kind of liked the picture so I decided to use it.
This is so true. I might also mention that the tax appraisal is not always a very good indication of market value for a home either. Neither is what your neighbor said they sold their house for. Both of these are things I often hear sellers say when they are trying to determine price for their home.
thanks. I have written about that too.
Back when we sold our last home, we ended up pricing it about $20,000 higher than our agent suggested. It still got showings and finally sold after a bit–for almost exactly what our agent had suggested in the first place.
That makes me think the best person to price your house is a Realtor who knows the neighborhood. This is coming from someone whose connections to the industry is hiring one to buy or sell my house and sometimes reading their blog posts.
That is fairly unusual in today’s market. Even the homes that are perfectly priced do not get many showings. Pricing is not an exact science and Realtors are wrong too.
What gets me is when people say, “well, this is house is really worth $350, but we are listing it for $340, what a steal!” Really? If it was really worth $350, it would have sold for $350. The defination of a market is where buyer and seller meet. The buyer and seller did not meet at $350, therefore, that was not market price for the home.
Very true . . and a house is really worth what a buyer will pay.
Theresa, you mentioned in your post “A great starting point for pricing your own home is going back to 2001.” Is this your opinion of where current values are at right now?
It is more of a starting point for pricing your home. In some neighborhoods prices are up from a decade ago and in others they are down.
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