Pricing your house can be a tricky thing. Most of us are used to walking into our local store, seeing the price on the shelf, and paying it. America is a retail country; we don’t haggle anymore, and most of really don’t know how to. To our benefit, open air market sellers across the world love to see Americans approach. For them it will be a haggle free and easy sale. The drawback, of course, is that we have little experience ballparking an appropriate price for an item that we aren’t familiar with price-wise, which can lead to two very bad scenarios; either the house sells for far too little or is too highly priced and is never bought at all. The goal then, is to find a fair price, and hew to it.
There are a number of factors that go into determining the value of your home. And it’s not just the house it’s self that drives the number. Mitigating factors that are sometimes out of your control can greatly affect value. The surrounding neighborhood and community are two big ones; is the area attractive, safe, and located near any amenities such as parks, libraries, biking and or running paths? How good are the schools in the area, and is there a convenient school for every level of education? For larger cities, how close is the public transportation, and is it reliable?
There are even more esoteric modifiers that can affect the selling price. Is the city, and more specifically the area experiencing an economic downturn or upturn? What are the demographics of the area, and how are they trending? Until fairly recently, after all, large metropolitan areas were experiencing relatively rapid grow and increased pricing, even as small towns and rural areas remained steady or even declined slightly as entry level buys flocked to the job rich urban areas. Perception can also count for or against your bottom line, fair or unfair as that may be. What do people really think about the city and neighborhood that you live in?
Ultimately there are tools that you can use to get as accurate a picture as you can. Find out what other similar houses in your neighborhood have sold for in the recent past. Professional estimators can also give you a reasonable and unbiased appraisal of your property that you can use as a benchmark going forward. It’s up to you as owner to determine the price that’s going to maximize your profit and minimize market time. In the end, the experience you build going forward will help you to hit that elusive target more and more accurately.