Pricing real estate is not the same as pricing most other items you may sell in your lifetime, it’s not simply the replacement value. Your home is only worth as much as someone else is willing to pay for it. There are many many factors that come into consideration when determining what a house is worth.
It starts with a detailed CMA (Comparative Market Analysis). This compares your homes to others in the neighbourhood are also for sale or have recently sold. On paper, it takes into consideration measurable data such as square footage, parking, beds, baths, and finished basement.
A great real estate team will take it further. They’ll view the competition to know the intimate details that can’t be seen online or in photos. The noise, the smells, the neighbours, and the things that may have conveniently been missed from the photos. They compare all of these items to the unique features of your home.
Agents use their expertise and experience to find a realistic price range for your home. That price range might be as wide as 10% in a regular market, or even vary by up to 20% in a tougher market and will be solidified by your motivation. If you’re moving to another city in a month you may price more aggressively compared to just relocation to a neighbourhood that you like better. If you have the time and patience to wait then you are in a position to test the upper range.
A lot of effort goes into finding the right price. Remember: if the agent shows up to the first meeting with a firm price promise that is more than you expected, you’re off to a bad start. I think that’s a recipe for disaster. Reality is important.
To ensure you get the most money possible, it is worth investing a little time and money into your home as well. Fix minor items that need to be repaired, replace furnace filters, paint the hot pink wall in the kid’s bedroom, clean every nook and cranny, and get a staging consult so a professional designer can give tips that will best showcase your home. Spending $1,000 now could get you $10,000 more on the sale price.
Lastly, your Realtor will have an impact on your final sale price. If their marketing is sub-par or if they’re taking photos with their phone you’re less likely to get top dollar. Make sure you choose wisely!