After making the decision to sell your home, you must decide on a listing price. If you list the home too low or high, you could risk losing out on potential buyers. Unfortunately, some homeowners incorrectly price their homes, which results in more time spent on the market than necessary. Before setting your listing price, it is important that you know some of the mistakes others made so you can avoid them.
Incorrectly Valuing Your Home's Amenities
Most homeowners know that amenities, such as an upgraded kitchen and bathroom, can help sell a home. However, there is a limit to what buyers are willing to pay for those features. There are also factors that influence just how valuable an amenity will be viewed.
For instance, an upgraded kitchen might not have as much value in a crime-ridden neighborhood as it would in a neighborhood that is considered safer. A swimming pool might not be as valuable in a cold climate as it would be in a hot climate.
Therefore, it is important that you fairly assess your amenities. Take the time to research the amenities in comparable homes that pushed the listing price higher. By doing this, you can learn more about what buyers are looking for and use that information to judge whether your listing price is reasonable.
Relying on an Appraisal for the Listing Price
Using a professional appraisal to determine the listing price of your home might seem like a logical move, but you could be shortchanging yourself. You could also be listing your home for far too much.
The appraisal is based on several factors, including the perceived value of your home's amenities and the neighborhood in which it is. It does not necessarily consider recent changes in the market. Sudden shifts in the market could mean that an appraisal taken just a few months ago is no longer valid.
If you do want to use your appraised value for the listing, review the amount with your realtor. He or she will help with determining if an adjustment needs to be made to your asking price.
Attempting to Recoup the Cost of Renovations
One of the biggest mistakes that sellers often make is adding in the costs of any renovations they have done to the listing price of the home. Although you might have replaced the heating and cooling system to prepare the home for selling, you are not automatically entitled to receive the cost of the replacement back in the sale of the home.
Renovations make it more likely that your home will sell. However, they do not guarantee that buyers will be more willing to pay a higher price for your home.