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Selling Your Home Yourself - Pricing It Appropriately
When you're selling your own property, whether it's a house, townhouse, condo, apartment, a finished lot, raw land, a farm, a ranch, or whatever, the first thing to get right is the price you ask for it. If you work with a broker, the legwork is done for you. When you work as a FSBO (for sale by owner), you need to figure it out yourself. Let's look at how to do just that. Setting a Price First, don't make the mistake of looking only at what you need to get out of it. It's important to know that, of course, but that number may, or may not, have any relationship whatsoever to market price. It may be lower or higher than market price. The first is situation is great. The latter may require you to rethink whether you want to sell your property at this time. If you price your property below market price, it'll be snapped up quickly. The problem, of course, is you'll leave a lot of money on the table. This will lead to a lot of seller's remorse. If you price your property above market price, it may sit there unsold until the cows come home. If it's priced very much above market price, people won't even come and look at it. The market place talks and it talks loudly. So What's Your Goal? Market price is nearly always a range of prices -- high, medium, and low -- not an exact price. You want to price yourself near the top of the market price range for your property. That way, you'll have flexibility to negotiate price if need be. The only exception to the above scenario is if you're in a hurry to sell your property. In that situation, you should price yourself near the lower end of the market price range. Even if forced to do this, make sure you leave some wiggle room to negotiate with a buyer. Buyers will always assume the listed price is negotiable. How Do You Determine Market Price as a FSBO? The first way is the simplest and most expensive. Have it appraised by an appraiser who works with one or more mortgage lenders. Call the firm who initially issued your mortgage loan and ask who they use in your area. Be sure the appraiser knows your purpose is to establish the asking price for a sale. Using an appraiser can cost a few hundred dollars, but it can be money well spent. In addition to helping you price your property, it can also be helpful to show a buyer with whom you're negotiating that an appraisal supports the asking price. If you live in an area with a tight pattern of sales prices, you can check the price of sales in your neighborhood over the last three to six months. This is particularly true if you live in a subdivision with houses in a narrow range of sizes and styles. Many jurisdictions have this information online. If not, it is a matter of public record and should be available at the courthouse. The more individualized and unique your property, the more difficult this approach. With a little work, however, you can learn a lot. Another method for establishing a price is an online search. If you search for "pricing + house + your state," for example, you should find sites that will help you price your property. Some of these use real estate agents and brokers as resources, and that leads us to another option. It's really unfair if you don't intend to use a broker to help you sell your property, but if that's your fall back position (if selling on your own doesn't work out), you might invite a broker to do a market analysis of your property for you. Be up front. Explain that you're going to try it on your own first. Even under those circumstances, many brokers are willing to help you evaluate the market price of your property without any charge to you. They also usually give you a presentation of how they'd go about marketing your property should you decide to use them. Listen to that carefully, too. You can start evaluating whether you want to work with this person if you're not satisfied with your FSBO efforts. You also may very well pick up marketing ideas you can implement yourself. A Note of Caution Don't rely too heavily on what neighbors tell you in social situations about the sale of their own and/or other properties in your neighborhood. Listen, of course, but be aware that they often just know the original asking price and the fact that there's a buyer in the picture. They don't know that the asking price was lowered because of the condition of the house, a redecorating allowance was given, etc. Don't talk to a neighbor and then think, "Well, that house sold for $X, my house is in much better condition; therefore, I should be able to get $X + $Y." Maybe so. Maybe not. Base your pricing decisions on the most solid information available to you, not neighborhood gossip. If you base your pricing decisions on solid information and use good common sense, you should get a good result. In this case, a good result means a quick sale! Raynor James is with http://www.fsboamerica.org - providing homes for sale by owner, "FSBO", properties. Are you thinking, "Should I sell my home?" Visit http://www.fsboamerica.org/seller.cfm to sell your home sale for free for one month.
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Real Estate Developers Are Now Designing With Instagram in Mind Fortune No one wants to design a store that people just walk past.” Long Island City real estate is going to be just fine without Amazon HQ2 CNBC While politicians decry the loss of 25000 jobs Amazon would have brought to NYC, real estate agents say the area will be fine without it. |
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