Figuring out how to price your own home can be difficult. You want to make a profit. And of course, all the money you spend on the new pool or updated kitchen will be recouped because you’re leaving your home much better than when you bought it. Right?
Maybe not. Many home sellers fall into myths about home pricing. Myths that seem to make perfect sense at first. Today’s real estate market is very different than what it once was, so it’s important to make sure you aren’t falling for any of the old hear-say that your buys definitely aren’t falling for. We are sharing some common home pricing myths you will want to make sure you don’t fall for to make sure your home sells at the right price! Keep reading to learn more and click this link for the full article.
1. You always make money when you sell a home
Sure, real estate tends to appreciate over time: The National Association of Realtors® estimates that home prices will jump 5% by the end of 2017 and continue rising 3.5% in 2018. But selling your home for more than you paid is by no means a given, and your return on investment can vary greatly based on where you live.
The NAR also found, for instance, that the cost of single-family homes increased in about 87% of the metros it studied, but prices actually dropped in 23 markets. So don’t assume you’ll walk away with a profit until you’ve examined what’s up in your area first.
2. Price your house high to make big bucks
We know what you’re thinking: “Hey, it’s worth a shot!” But if you start with some sky-high asking price, you’ll soon come back to Earth when you realize that an overpriced home just won’t sell.
“While the payday might sound appealing, you’re actually sacrificing your best marketing time in exchange for the remote possibility that someone will overpay for your home,” says Kathleen Marks, a Realtor® with United Real Estate in Asheville, NC.
While certain buyers might be suckered in, this becomes far less likely if they’re working with a buyer’s agent who will know all too well when a home is overpriced, and advise their client to steer clear. And this can lead to problems down the road (as our next myth indicates).
3. If your home’s overpriced, it’s no big deal to lower it later
Sorry, but overpricing your home isn’t easily fixed just by lowering it later on. The reason: Homes that have lingered on the market for months—or that have undergone one or more price reductions—make buyers presume that something must be wrong with it. As such, they might still steer clear, or offer even less than the price you’re now asking.
Bottom line: “Price your home appropriately from the beginning for your best shot at having a quick and easy sale,” Marks recommends.
4. Pricing your home low means you won’t make as much money
Similarly, sellers are often leery of pricing their home on the low end. But as counterintuitive as this seems, this strategy can often pay off big-time. Here’s why: Low-priced homes drum up tons of interest, which could result in a bidding war that could drive your home’s price past your wildest dreams.