6 Tips For Pricing Your Home

You love your home! Love the neighborhood, your kids love the schools, and the location is great.  Or it least it was when you bought it. Life has changed.  Last […]

February 11, 2017 // Tracy Shaffer // No Comments //

You love your home! Love the neighborhood, your kids love the schools, and the location is great.  Or it least it was when you bought it. Life has changed.  Last Saturday you swung by an open house on your way home from the grocery store just for kicks and guess what? You fell in love. The new love has better light, bigger closets, and an over-sized garage which you sorely need. As those kids got bigger, so did their skis, their bikes, and then there are your toys.  Maybe they’ve gone off to college, or you’re soon to have an empty nest. You want something smaller, more manageable.

Whatever the reason, it’s time to sell your current home and move on to a place that suits your current lifestyle.  You want to protect your investment, maximize your profit, make a smart move, and in Denver’s hot real estate market, make sure your home sells swiftly enough so that you can seamlessly close and purchase on the new place.

Pricing is Key.

In a super-inflated market, some sellers believe they get to call the shots where home values are concerned, but a home is worth what a buyer is willing to pay for it so reason prevails. Chances are you’ll be meeting with a Realtor or three to go over marketing strategy, your timeline and of course, your home’s current market value. Here are some factors we look at and you should too.

What is Your Neighbor’s Home Worth?

The value of your next-door neighbor’s home is particularly applicable in suburban communities where there are a limited number of models, and the variables are smaller.  An agent can run comparable properties with some certainty that they are indeed comparable, factor in upgrades, location in the subdivision, etc., and determine a very accurate market list price for your home. In the city, values can vary widely as Bungalows sit next to Mid-Century Moderns and Dutch Colonials with less uniform home and lot sizes, additions, and improvements.  I work in metro Denver, particularly Park Hill, where the neighborhood is divided into quadrants. The diversity of homes and home prices mean I must be meticulous about pricing homes even when they’re in the same neighborhood, cherry picking sold properties to make sure they are a good and logical match. After all, your buyer and their appraiser will be looking at values as the process proceeds.

Precision pricing means a couple of things. I can, with some degree of certainty, look at the data in your neighborhood; homes recently sold, those under contract and active listings, preview the ones on the market and tell you which three will sell and in what order. Listing a home for sale, it’s impossible (for me) to set a price before I’ve toured your home and done my research, because my goal is to make sure that your home ranks in that top three.

How Can You Tell if Your Home is Overpriced?

Location. Location. Location. This cliché means more than what city you’re in or what kind of view you have. It also means where in the neighborhood, how close to the neighbor’s house, how close to amenities, how do your local schools rank and if you’re in Park Hill, where are you within the boundaries of the micro-neighborhoods?

Look at the curb appeal of your home, not just the landscaping and the flower pots, but the total picture. Does the roof look in need of repair? Is there paint cracking under the eaves? This is your first impression, so make it a good one. Take a weekend and touch up paint, clean gutters, rake the dead leaves from your garden and throw down some fresh new mulch. Have a reputable roofer come out and inspect your roof (call me if you need a referral). You may find that you are eligible for a replacement under your current homeowners’ policy, or it may be certifiable with some minor repairs. This will give your buyers peace of mind and keep you from negotiating roof issues after the inspection.

Have You Made Updates?

Your home may be perfect for you but it you’ve not made any major improvements since you updated to that Southwest kitchen in 1991, it might not be so perfect for your buyer. My suggestion? If you can’t do a full kitchen remodel, make sure your place is spotless. Paint, bleaching grout, even updating a faucet can make the future owner feel they can live comfortably until they make updates of their own. This will factor into pricing, of course, but sinking $20k into your kitchen might not provide the best return on investment.  Some minor sprucing may not increase your home’s price tag, but it will help your home sell faster.

Don’t Price Based on What You Owe, What You Want, or What You Need.

Yes, it’s your biggest investment and of course you want to make a profit. Thankfully today’s Denver market has given most homeowners a healthy heap of equity, but if you’ve been borrowing against your home through a series of re-finances, you will have spent it preemptively. If the market is not in your favor, better to wait than to over price. There will be costs involved in selling and a good agent will factor those in and provide you with a net sheet.  Best advice; price correctly and let the market drive the price up. You may not make a “killing” but you still may be making a great move.

Find a Great Realtor.

Buying or selling a home is a very intimate and sometimes stressful process. You want to find someone who knows the overall market, knows your neighborhood (or is willing to do her homework) and someone you can trust.  It would seem as if I’m stating the obvious, but, as with any profession, quality varies.  Agents who will tell you exactly what you want to hear when it comes to the value of your home do you a disservice if they can’t back it up with data and marketing expertise. Some agents come in with a bang-up listing presentation, pressure you to sign the contract and then pass you along to an assistant or less seasoned teammate. That can work and work well, mostly for the agent. If you desire a more hands-on experience, hire a workhorse rather than a show-pony. An over-priced home will not lure buyers and a great agent will work to identify who your perfect buyer is.  Look for an agent who listens to you, wants to work with you as well as for you and one who communicates well from the get-go. There is a lot of information that comes down the pike during the real estate transaction and the ability to make this info clear is vital. Sellers make the decisions, agents should work as your trusted advisor, keeping you in the loop on legalities and negotiation strategies that continue after the contract is signed. You may not always hear exactly what you want to hear, but you want to hear the truth.

If you, or someone you know, is looking to buy or sell a home, call me and let’s talk about what you need, want, and dream about.