Pricing a home is one of the most important elements of the selling process. Unfortunately, it can be very tricky to set a reasonable price that will attract buyers. Below we walk you through all the steps you’ll need to take in order to properly price your home.
Step 1: Assess the market value of your home
This step can throw people off immediately, usually because they don’t know all the factors that contribute to a home’s value. Here are some easy tricks to get an accurate estimate of the market value of your home.
- See how much homes in your area sold for: Thanks to the Internet, this step is incredibly easy. Sites like Realtor and Zillow will tell you what the average home in your area sold for with the click of a button. However, it’s still best to get an estimate from multiple sources since the information is not always 100% correct.
- Talk to a BUY MY HOUSE NOW representative: Our team has been buying and selling homes in Arizona exclusively for over 10 years. It’s our job to know what homes should and do sell for. We can provide information about recent sales in your area, and make sure to get the sale price and date, the square footage, the number of bedrooms and baths, and the year the home was built.
- Get in touch with your local tax assessment office: It might not be appealing to contact a tax office, but they’ll have a lot of valuable information about property sales in your area from the past few years. Be sure to ask for a list with all the details you’ll need (listed above) to make a proper assessment yourself. It’s important to keep in mind that other homes are almost never exactly like yours, so you’ll have to make adjustments to the information you get in order to make an accurate assessment.
- Check your local papers: Most local newspapers will have a section dedicated to property sales in your area. Take advantage of that, and see what the average is. It might make sense to look every week, just to see if the market is increasing or decreasing. You probably won’t get all the information you need from newspapers, but they can be a helpful and easy tool.
- Get a property profile from an insurance company: All insurance companies keep data on homes in a certain area. The key to utilizing this data is going to their local office and feigning interest in buying insurance. Once you do that, ask for a property profile; if they think you’ll buy insurance from them, they might just give you one for free. The great thing about the profile is that it’s already well organized, with a list of properties comparable to yours, and all the specifics of said properties. The one caveat is that not all insurance companies will do this for free; even so, you can easily obtain one for a small fee.
Step 2: Organize your data
Now that you have so much data on local homes from multiple sources, here’s what should you do with it:
- Make a spreadsheet: Spreadsheets are the easiest and fastest way to organize all the data you’ve assembled. It’s best to make a different column for each piece of information, which should include the sale price and date, the number of bedrooms and bathrooms, the year the home was built, and the square footage, as well as the selling price. Be sure to list your house first (without the selling price, of course), as that will provide a good benchmark for comparison. If you’re unsure about your home’s square footage, check your closing papers.
- Sort the properties: Not all of the homes that you will obtain data on will be useful for you. A good rule of thumb is to get rid of all of the homes that were sold over 6 months ago, as it’s likely that the market will have shifted dramatically since then. Don’t use older sales unless you can’t find enough new ones to make an accurate assessment of the market.
- Find 3 or more homes that are similar to yours: Narrowing down your choices is key to getting an accurate estimate of what your house should sell for. Using the following criteria, pick out at least 3 homes from your spreadsheet that are the most similar to yours (REMEMBER: It’s very unlikely that you’ll find a house that’s exactly like yours):
- Style of home
- Square footage
- Size of lot
- Number of bedrooms and bathrooms (be sure to check if they’re full or half baths)
- Location of home
- Age of home
- Is there a finished basement?
Step 3: Crunching the Numbers
Now’s the fun part; you’re going to need to do some calculations to come up with a good price for your home. Here’s how to approach it:
- Adjust the prices of the other homes, if necessary: Remember how we said that it’s likely that you won’t find a home exactly like yours? Well, if you don’t, you’re going to have to adjust the prices of those homes to match yours using some educated estimation. If you’re confused, here’s an example to help you out.
- You’ve found a house almost identical to yours that sold 2 months ago for $250,000. The only difference is that it has one full bathroom, while your house has two. Find out how much a bathroom will add to the market price of a house (it can be up to $10,000), then add that number to the price of the other house to get a good estimate of what yours will sell for.
- Use the adjusted home prices to find the range for your home: After adjusting the prices for the houses that are the closest fit in your area, you can find the range that your home will sell in. If you’ve found 4 homes, let’s say, for $250, $256, $264, and $275 thousand, the likely range that your home will sell within is between $250,000 and $275,000.
IMPORTANT: Don’t use the asking price of a home when estimating! Homes are often sold far below the asking price, so you should only use the final sale price of the home when making your estimates.
- Find your asking price: Negotiation is a key part of the selling process, which is why you never want to sell a home at market value, because you’ll probably end up selling your home below that number—something you never want to happen. It’s hard to say exactly how much you should add to the market value; that all depends on your area. Check other homes in your area and compare their asking prices to what the home eventually sold for. You might be able to add up to $20,000!
Selling your Home for Cash
Our goal is to help homeowners find a solution to selling their home. At BUY MY HOUSE NOW are committed to providing the highest quality service in a timely manner and truly feel that our efforts genuinely help homeowners get the best value for their property.
We buy any home in any condition and DO NOT require any repairs to be done by the homeowner! Our experience buying homes in Arizona helps us to approach each new property with a clear understanding of how to value and purchase each home for the best possible price – even if a home is in a difficult financial situation!
Hopefully, the steps we’ve provided will help you arrive at an accurate estimate of what your home should sell for. If you are looking to sell your home contact our offices today and we can get the process started and finalized within 7 business days!