When you put your home up for sale, one of the best ways to determine an asking price is to look at comparable sales. There is rarely a perfect comparison, so a pricing decision often relies on comparisons to several recent sales in the area. Here are five criteria to look at when pricing your home.
1. Location
Location, location, location! Homes in the same neighborhood typically follow the same market trends and thus have similar values. Comparing your home to another home in the same neighborhood is a good place to start. That said, it is even better to compare your home to another home on the same street or block for a more accurate price reflection.
2. Date of Sale
Housing markets can see a ton of fluctuation in a short time period, so it is best to use comparable sales that have happened recently. A sale on a similar home that sold a year ago, may reflect a completely different market and price point than your home would see today.
3. Home Build
When looking at comparable sales prices, search for homes with similar architectural style and overall vibe. Look for homes with the same number of bedrooms, bathrooms, square footage and other basics. Choosing a home that is structurally similar to yours will result in a more accurate price comparison.
4. Features and Upgrades
Upgrades and remodels can raise a home’s price. When looking for comparable homes, search for items such as upgrades to kitchens, bathrooms, HVAC, systems, roofs etc. Failing to compare a home with similar upgrades could result in you asking less for your home than it is worth.
5. Sale Types
When looking for comparable sales, make sure to look at similar home sale types. Homes sold as short sales or foreclosures are often in distress or sold at a lower price point than they’d receive from a more typical sale. These homes are not useful when looking for price comparisons.
Overall, market trends and comparable sales are a great way to price your home. An experienced agent will work with you to determine your home’s worth and to set a fair asking price.