Setting a listing price for your Shoreline, WA home involves a lot more than just deciding what you think the home is worth and throwing it on the MLS to let it get bid-up. A lot that goes into determining the best price to list for. You want to set a listing price that’s not too high (so it will still be attractive to buyers and you can sell fairly quickly), but not too low, either because obviously you want to get the most money possible.
The process of determining a listing price is both art and science, and as a Shoreline, WA real estate agent, helping my clients get all the information they need to decide what price to ask for on their home for sale is a very important part of my job. Fortunately, there are some fairly standard procedures, pricing formulae, and influencing factors that agents use and take into account.
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What About Automated Means Of Estimating A Listing Price For Real Estate?
You may wonder if an automated tool like the computerized estimates found on some websites can give you an accurate value for your home. Roughly speaking, they will put you in the ballpark, but they can’t take into account things like the interior condition of your home, upgrades, views, and the quality of the neighborhood. The more diverse the types of homes in your area and the fewer recent sales in your neighborhood, the harder it is for a computer-brain to home in on your property’s value. That’s why it’s good to get a personal assessment of your home’s value from a person if you’re considering selling or refinancing.
So let’s see how Shoreline real estate agents like me determine the listing price for your home.
Overview of Listing-Price Determination
The main points to keep in when it comes to determining listing price are:
- How does your home compare with similar nearby recently sold homes (recently sold usually means in the last six months, but if you’ve had a lot of movement in the marketplace, more recent comps (Comps = Comparative Sales) should be more heavily weighted.
- The current competition in the local market. Are homes going for over asking price, or under; how quickly are the being sold. Are sellers having to offer concessions, are buyers waiving contingencies?
- The condition of the homes in question – was one near a park, on a busy street, next to a bus stop, or did it have a trashy neighbor? All these factors, while outside your control, can contribute to the home’s perceived value in the marketplace. In addition, look around inside. I have seen rental properties badly in need of paint, carpet and more. Other homes look picture-perfect, even though they’re 20 years old. How well has your home been maintained, upgraded and even remodeled over the years?
It’s important, then, to understand how Shoreline, WA real estate agents typically arrive at a price for your home.
The primary pricing tool agents use is a comparative market analysis (CMA). The CMA results will outline the proposed listing price and allow you to understand the reason for that particular price, as well as providing the basis for a marketing plan.
Formerly, fairly simple write-ups of property comparisons called CMA’s (CMA = Comparative Market Analysis), are now lengthy and complex, often having been generated through the use of specialized software. They typically “show average and median sale prices, price adjustments, local minimum and maximum sale prices, days on the market, individual closed sales, homes that were listed but did not sell, the best time to sell, the impact of overpricing, etc.”
Still, there are other things your agent will take into account in determining the price. And that’s why proper pricing depends on agent experience and resourcefulness as much as it does plugging figures into the CMA software. You can find out more about what goes into it by calling a Shoreline agent at (206) 395-6262.
The Four Factors That Influence Listing Price
There are a host of factors that can influence how you should price your home. But the ones with the most impact are the comps (the results of the CMA), location, condition, and updates.
1) COMPS (Comparable Properties/CMA RESULTS (Comparative Market Analysis)
In simplest terms, this is a comparison of the prices of recently sold houses that are very similar to yours and in close proximity to yours. It also includes your current competition – that is similar homes in the area currently for sale and their time on the market.
For the CMA to be an accurate tool for determining listing price it must take into account homes that are very like yours with respect to condition, age, features, number of rooms, square footage, and so on. These homes also have to be close, ideally within the same neighborhood. And they have to have sold recently, ideally within the past six months at most.
After running the comps your Shoreline agent will have a fairly good idea of what the listing price should be. But there remain other things to factor in.
2) THE LOCATION
If your home is located close to important amenities, it will likely sell for more than very similar homes that aren’t as close to those amenities. Proximity to things like good schools, entertainment, and dining will make it more desirable to buyers, and your agent will use that in determining listing price.
Other location-related factors include whether your home is situated on a busy street or a quiet cul-de-sac, as well as crime rates for the area and the location’s economic outlook. Your Shoreline agent will look at all these when coming up with a listing price.
3) YOUR HOME’S CONDITION
Because no two houses are exactly alike, your home’s condition will also play a role in pricing. If your home is in better condition than the comparable homes used in the CMA, you can set a higher list/sale price.
In fact, buyers have been known to pay up to $15,000 more for a home that is well maintained and in excellent condition. So with repairs and refurbishments, a good roof, and a top-notch HVAC system, you can typically list your home at a higher price. To find out how to prepare your home in this regard, contact your agent.
4) HOME UPDATES
Similarly, your Shoreline agent will also take into account any updates when determining listing price. Updates – whether repairs, upgrades, or a major remodel – will definitely impact your home’s value in a positive way.
Unfortunately, not all updates will allow you to list your home for much if any more. Some updates simply yield a better return on investment at sale time. So if you’re considering some updates or upgrades prior to listing, be sure to consult your Shoreline agent first.
Why You Need a Good Shoreline, WA Real Estate Agent to Determine The Best Listing Price – From A Strategic Perspective
Certainly, you can determine a listing price yourself, but should you? Remember, pricing right is often considered the best marketing tool – the one that can get you a quick sale at a good price. And determining the right listing price usually takes a lot of experience, skill, and intuition. If you want to get your listing price right with the assistance of a good Shoreline, Washington real estate agent, contact us today at (206) 395-6262.