Selling your home? Make sure the price is right
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"Homeowners don't spend enough time studying
how to price their home," says Ilyce R. Glink, author of "50
Simple Steps You Can Take to Sell Your Home Faster and for More
Money in Any Market." She recommends getting a comparative
market analysis from three different agents. Chances are they'll
all be different, but they should all fall within a range. Try to
identify the real estate agents who do the most business in your
neighborhood. They will be most familiar with details of other houses
in the area that have been marketed successfully or unsuccessfully
and will be acutely aware of what impact those details had on selling
price. Whatever you do, don't get a comparative market analysis
from your uncle's golf buddy who sells real estate across town.
You can also find excellent reports available from
online services such as HomePrice
which, for a fee, will provide you with detailed property information,
and a value range for the property based on comparables in the area.
A free report on comparable sales in your area is available from
A comparative market analysis, however, is not the
be-all and end-all in determining price.
It can be incomplete or too dated to reflect current
market conditions and, of course, no two houses are ever exactly
the same. Also, they don't take into account subjective factors
like curb appeal, an especially eye-pleasing view, or proximity
to a bus stop, which explains why some experts recommend getting
a professional appraisal as well as a comparative market analysis.
"Real estate agents are not professional real
estate appraisers," says Supple. "Some will inflate the
value of your home just to get the listing."
He recommends springing for a professional appraisal
even before you set your asking price, especially if you're going
to sell your house on your own without going through a broker.
But an appraiser's report could set you back $300
or more, so if you don't want to spend that much you can do some,
but not all, of what an appraiser would do by visiting your county
courthouse or property appraiser's office and looking up the information
yourself. Many county property appraisers or tax collectors now
have online search tools you can use to find the information without
But it's a good investment for any home seller. For
one thing, a professional appraisal done by a state-certified property
appraiser will be required if your eventual buyer intends to finance
the purchase with a mortgage. Having your own appraisal will give
you an accurate idea of the maximum amount lenders will be willing
to finance for the buyer.
The appraiser will first inspect your property from
foundation to attic and note its features, including quality of
construction and amenities. Then the appraiser will perform a market
analysis that will compare your property to similar properties that
have sold recently in your area. The appraiser may even call real
estate agents in your area to determine market conditions in your
When that's all done, the appraiser will write up
a report and you will know the appraised value. That is not the
same as the market value, which Supple says "is the highest
price that a property will bring in an open and competitive market."
It has nothing to do with how much money you may need
to buy your next house, or how much money you want in order to recoup
what you spent fixing up the place.
"In a seller's market, a good rule of thumb is
to add 10 to 15 percent on to the appraised value," says Supple.
"In a buyer's market, add 2 to 3 percent."