How to Determine Your Home's Fair Market Value and Set a Listing Price
Priced to sell: Tips for setting a listing price that is competitive with the current market and price trends.
One of the first questions raised by a seller is: “How much is my home worth?” For sellers, the number they have in mind is often different than the home’s fair market value and a listing price that will be competitive in the local North Carolina real estate market. It is understandable for there to be a wide gap between these amounts since homeowners have an emotional stake in the sale of their home. While a home may feel invaluable to the owner, it won’t sell if it is priced too high.
Because of the emotional issues involved in the sale of a home, it is the listing agent’s job to present real world evidence to supporting the home’s fair market value and a competitive listing price. When interviewing listing agents, you should ask for specifics on how each agent will determine your home’s fair market value and set a listing price. Starting off with the right asking price is vital to selling your home successfully.
How Your Listing Agent Determines Fair Market Value
The real estate professional you choose to list your home for sale in North Carolina will use local market and inventory knowledge, paired with an analysis of market data, to present an educated, evidence-based pricing analysis. A CMA (comprehensive market analysis) uses recent market data of both active and sold listings to provide an accurate picture of your home’s value.
Your North Carolina real estate agent should go beyond MLS data to generate a CMA, determine your home’s fair market value and set a listing price. In addition to readily available data, your agent should use their first-hand knowledge of the housing inventory and information they have gathered by touring homes. By employing a comprehensive strategy, you will have a powerful representation of how your home compares to other houses on the market that will be competing among for same pool of buyers. At that point, you have a good idea of how to set a competitive asking price to sell your home, on your terms.
The Repercussions of Overpricing Your Home
Sellers often pressure a listing agent to start the home selling process by “testing the market” with an asking price that is more than the home is worth. There are many reasons why this is a bad idea. Let’s take a look at some of the reasons overpricing your home could damage your chances of selling your home quickly and at a price that meets your expectations.
Seller’s are in a position of strength in the first 30 days of listing a home for sale. An overpriced home can cause you to lose this advantage and chip away at your credibility, which will, in turn, scare away informed buyers. As your home starts getting stale and there is little to no interest, you’ll find yourself lowering your listing price. This is an instant red for buyers. The result of “testing the market” with a higher asking price than what your listing agent recommended is usually a closing price which is less than you should have received for your home.
As you can see from the information above, pricing your North Carolina home correctly is a crucial factor to selling your home quickly. Red Door Company utilizes our “Right Price” strategy, which takes into account your home selling goals, pricing expectations, and local market data, to set the right price so that you remain competitive in accordance with current market and price trends. If you would like to learn more about how we can help you determine your home’s fair market value and set a listing price to sell your home in Raleigh, Durham and Chapel Hill on your terms, contact us today.