The Art & Science of Pricing a Home

Price can either be a big draw or a big deterrent when it comes to selling a home. That’s why it’s so important to set the right sale price from the beginning.

Around 40% of sellers do not correctly estimate the value of their home, and that could put you at a disadvantage when it’s time to sell.

We know that every neighbourhood and community is different, and that has a unique impact on sale price and strategy for every property we sell.

Let’s take a closer look at the following:

✔️   Market value vs property prices
✔️   Finding additional home value
✔️   Owner-occupiers vs investors
✔️   Is price everything?

Market value vs property prices

The aim of a sale is to make a potential buyer see ‘value’ in the property for the ‘price’ they are willing to pay.

While house prices can be broadly guided by market factors like comparable sales, average price trends and supply and demand, it is the value that ultimately determines the final dollar amount. Naturally, value is perceived and set by the individuals willing to buy.

At RE/MAX NOW, we believe it is our role as agents to help the market see the optimal level of value in every property, in order to help get the best possible results for your sale.

Finding additional home value

When determining the value of your property, it’s important to be realistic – this means some of the features of the house that you love may not be as desirable to the wider buyer market. Likewise, features that you might not perceive as valuable could mean much more to a wider market.

Some buyers might be willing to pay a higher price for the specific features they want in a home, and a qualified real estate agent will understand how to use your home’s features to attract the right buyers.

For example, some buyers might place more value on finding a home with an in-ground swimming pool and would be willing to pay more to get what they want. A home in close proximity to a school might be more valuable to a family with young children, and even a home in need of repairs or improvements may prove enticing to certain buyers who see an opportunity to add value by renovating property.

Owner-occupiers vs investors

Whether the potential buyer is planning to live in the property or purchase it for investment may also determine what a buyer sees as good value – and a fair price. This is yet another example of the art and science behind setting the right price.

Most investors will be more ‘transactional’ when it comes to agreeing on a price; what rental yield they can get and what potential capital gains might also be on offer. If an investor prioritises features, it is a good indicator that the property is more likely to be rented out.

On the other hand, owner-occupiers may be more attracted to ’emotive’ considerations; somewhere they could be happy to live in with their family. How livable is the space? Can they turn the house into a home? Is the local community one that they want to become a part of? How can they make the most of the local amenities and infrastructure?

Having a better understanding of the type of buyer that is best suited to your property will help inform your decision on its price, as well as where to invest for pre-sale improvements. Speak to a RE/MAX NOW professional today to find out how to get the most out of your property.

Pricing your home

While price is definitely important, it’s not the only part of a successful sale. In a buyer’s market, you may see buyers willing to wait for the right deal, and in this case price is key.

You don’t want to out-price potential buyers; however, in a seller’s market you could end up with multiple offers – some of which even exceed your original asking price.

On the flip side, a home priced too high has the potential to scare off buyers, possibly allowing your home to sit on the market for longer, and produce a lower selling price.

Sometimes, sellers and buyers don’t agree on a home’s value. In this case, a knowledgable agent relies on local expertise, market research and data to help reinforce the price and in negotiations to help you get the best deal.

This is why it’s so important to get a professional opinion before you take your home to market and potentially end up with a mismatched deal. If you do, it could mean a lost opportunity to sell your home.

Key takeaway: price it right from the beginning.

Having the right price point at the start of your sales campaign will put your home in a stronger position to get more attention from qualified buyers, so work with your agent to get it right from the very beginning.

Rely on your qualified agent to help you price your home right. When you list with RE/MAX NOW you have more eyeballs on your property and more opportunities to get the best result for your property.

Local expertise, Global reach

RE/MAX NOW has the strength, magnitude and tools to connect your home with a global marketplace, providing access to millions of buyers around the globe, giving your property the best chance for a great result.

With the advantage of global reach and local expertise, our experienced agents combine local know-how and market data to determine property value and drive the right price for your home.