Strategies to help maximize your home’s selling price
When it comes to the pricing of your home, we often get opinions from everyone.
Buyers, like relatives, are very blunt with their price comments. To have buyers make positive remarks about your listing price and to get a market-value offer, follow these key strategies.
REVIEW SOLD LISTINGS
Contact your realtor and review the sold prices of similar properties in your neighbourhood. This is the most critical data and the most important part of the process because these sold listings will tell you what serious buyers are willing to pay for a comparable home in your area.
When reviewing these listings, you’ll need to adjust your list price for any differences in specific location, lot size, updates, upgrades, condition inside and outside (this is very important), garage, time of year, etc.
In our current balanced real estate market, always price your property at the most recent sale price or very close to the last sale price. This will give you the best chance to get a full-price offer.
REVIEW ACTIVE LISTINGS
Examine all the current properties for sale. These listings will be your competition. You’ll need to choose a list price that’s competitive and compelling enough to attract the right buyers. Always price your property slightly less than the competition.
REVIEW HOMES ABSORBED EVERY MONTH
Your realtor will share this information with you. It’s more work for your realtor but it will help educate you on the supply and demand in your area.
This part of the pricing process is often referred to as the Absorption Rate (AR) analysis.
To determine the AR, calculate the average number of homes sold in the last six months. Then take the number of homes currently for sale and divide this number by the average number of sales each month. For example, if 20 homes are selling each month and there are 60 current houses for sale, then the AR is three. This means it will take three months to sell the inventory of current listings.
Reviewing this analysis will indicate if you’re in a buyers’ market, a balanced market or a sellers’ market. If there’s an increase in the AR, you’re entering into a buyers’ market. If the AR remains constant at three months, you’re in a balanced market. If the AR decreases, you’re moving into a sellers’ market.
A property will sell at market value if it’s listed at the right price. Listing at the right price increases your pool of buyers and an increase in your buyer pool creates competition. Competition creates excitement, which normally nets you a market value offering price.
A market-priced listing will sell faster. Why? Let me explain.
When a new listing comes on the market, buyers rush to view it. If they like what they see and the list price is at market value, these buyers will submit an offer.
This first offer is often your very best offer. I can give you hundreds of examples where sellers did not accept the first offer, only to end up selling for tens of thousands less.
If you follow these important steps, you’ll price your house correctly and it will sell at market value. Patrick Morris is the leader of the Morris Home Team and a Broker with Royal LePage Performance Realty. He has consistently garnered the No. 1 position in Ottawa for Royal LePage since 2001 (in number of homes sold, as per MLS Statistics). Patrick can be reached through morrishometeam.com.