Price it correctly for the market!

What is market value? Market value is the amount that will bring a sale between a buyer and a seller, given that a home has had full exposure to the market.

In order to price your home correctly for the market, you need to know where the market is and how your home compares with others that have recently sold. Do your homework. Is the local market rising, falling or staying even? Once you get a feel for the local market, it is extremely important that your home’s price be set at a level that is close to or exactly at the point where a Comparative Market Analysis (CMA), as presented by a real estate professional, indicates it should be. Note: If the market is rising, you might be able to price the home slightly higher than the CMA indicates. If the market is falling, you are much better off pricing the home lower than the CMA indicates.

You might be tempted to initially price your home higher than the CMA indicates and then drop it within a few weeks if you don’t see an offer. This could be a costly mistake. For example, when your home goes on the market for $650,000 but the CMA indicates it should be priced at $610,000, buyers looking in the $610,000 price range are not going to look at it because it is priced out of their range. Conversely, those buyers in the $650,000 price range are going to compare it to other properly priced $650,000 homes and see that it doesn’t compare. The end result is that it is priced too high for those who can afford it and it doesn’t compare to those homes priced in a higher price range.

By the time that an overpriced home is finally reduced to where it should be, it may be "stale." A stale listing always brings a lower sales price because buyers think that there is something wrong with the home because it has been on the market for so long. Have you ever asked how long a home has been on the market? What conclusion do you draw when a home has been on the market for a long time?