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The Facts of Life for Home Sellers
The market is not always kind, but it is never wrong... and those who believe otherwise pay a heavy price for ignoring these "facts of real estate life."
It is important to keep in mind that in any market, homes sell based on three main factors: price, exposure and condition. The single most important ingredient in selling your house is pricing it correctly. You must start thinking about your house objectively, not emotionally, as a product or a commodity which must compete against every similar product on the market. The question being, how long do you want your home to be for sale?
A real estate professional will be glad to provide you with a Comparative Market Analysis (CMA), which is essentially an evaluation and opinion of how much your house would sell for in the current real estate market. It will be compared to houses currently on the market, houses that failed to sell (for whatever reason) and houses that have sold within the past year.
It is worth considering your reasons for selling, your timetable, details about your house, its strengths and weaknesses, and how your house fits into the current real estate market. While location is important, the neighbourhood is critical to pricing. People frequently buy the neighbourhood first, and the house second. The same home in a different neighbourhood can have a dramatically different value.
A primary consideration is the overall market. Supply and demand dictate home sales- whether it's a so called "seller's market" or a "buyer's market." Are there more buyers than sellers, or vice versa? Homes will sell more quickly and at higher prices if lots of people want to buy, and inventory of houses available is low.
A buyer's market is when there are more homes for sale than buyers to purchase them all. Properly priced homes will sell even in a buyer's market however the number of similar unsold homes in the market that are competing against your home is critically important. Your home must be positioned competitively against similar homes in the market in order for it to sell. How fast your house will sell is up to you, the seller. Time on the market is directly related to price.
The market is boss.
Your home will sell for what a buyer is willing to pay for it in comparison to all other similar homes on the market, and no more. What you paid for it, what you think it is worth, how much cash you need out of it, what your friends, realtor, or even appraiser thinks it is worth does not set the real value. The cold, hard truth is that only the market sets its value. As such, being a seller you are a price taker and not really a price setter.
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Copyright ©2007 Peter Kunz. All rights reserved. |
Royal LePage Partners Realty is an independently owned and operated brokerage. |
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