The Spring market is upon us and Buyer activity is heating up. To increase the potential for offers on your house, proper pricing is necessary. Increase appeal with low-cost, high-value upgrades can mean more offers.
It’s Always About Price
There’s two strategies that are generally followed when it comes to listing price. The first is to list at top price and lower the price incrementally until it sells. Sellers who go this route are usually in less of a hurry and more risk averse. A second strategy is to list slightly under expected sales price. These sellers are usually more in a hurry to make a sale, and they are hoping for multiple offers, which would boost the final selling price. The latter is best for getting the most money for your home, as long as you feel the house will appraise for the higher sales price. Here’s how to do it:
If your home is worth $400,000, price it at $399,000. This way, you capture everyone who might be setting their search ranges at $400,000 or less. Similar to how products are priced in retail stores, psychologically a price that ends with 99 appears to be a better value. Better still, pick a price that deviates from both, such as $397,400 which studies have shown also increases the perception of value.
Underpricing your home has risk. What if your home is worth $400,000 and you list it for $375,000, and the offers all come in at $375,000 or less? That could be the market telling you that $375,000 is your home’s actual value. But, you can always counteroffer or decline low offers. Conversely, listing your home under value creates a psychological sense of urgency. You want buyers to visit your home and become attached enough to put in an offer. If enough people do this all at once, you can create a perceived buyer frenzy and potentially increase your chance for multiple offers and a higher end result.
Analyze Comparable Properties
Your Realtor will create a comparative market analysis (CMA) of recent sold, current active and pending, and recently expired and off-market properties. What is selling is as important as what is not. The rule of thumb (which may vary from area to area) is to price your house within 10% of the average homes in your area. If there are few sold comparables in the neighborhood, price your home 10% under currently active or expired listings.
Minor Home Improvements Projects
Many home improvements may enhance your home’s value. It could be significant like putting in an expensive new kitchen or bathroom, but stick to the lowest cost for the highest possible value. Your goal should be to make a positive first impression to sell your home quickly.
Don’t Forget The Floors
If your carpet is getting on in years, or has unsightly stains or is starting to buckle, it’s time to replace it. But consider the alternatives. Many of today’s buyers see more value in hard floors. Buyers with kids or pets might prefer engineered floors, bamboo, or cork for their sustainability. Hardwood is popular with new construction. Also keep in mind: one continuous floor of the same material also creates the appearance that the home is bigger, creating the impression that your home is worth more.
A coat of paint can cover scuff marks and dirt and brighten a room. You may have liked the flaming orange in the foyer or the dirt brown in your family room. And that’s great! However, chances are that buyers won’t have those similar tastes. A better choice, when getting ready to sell, would be to opt for neutral colors like grays, whites and earth tones.
Spruce Up Your Kitchen
Fully remodeled kitchens are a great return on investment - long term - but don’t spend the money if you are looking to sell in short order. Painting cabinets with chalk paint is a good and inexpensive way to revitalize the kitchen. It looks so good the buyers will barely be able to tell it’s not the original finish. For about $500, you can transform your kitchen in a weekend.