Three factors play a role in the sale of your home:
Location, Condition and Price.
Obviously you can’t change the location of your home — that’s why the old “Location, location, location” adage holds true. So, you have condition and price to work with when it comes time to sell real estate in Denver.
Once you’ve determined how your place will appear to home buyers, hopefully after discussing possibilities with your Realtor, you’re ready to determine your Denver real estate market value.
The market value of your home is not determined by what you think it should be worth, or what you hope it’s worth, or even what you paid for it plus the cost of all the improvements and repairs you’ve put into it over the years. Say it with me now: Your home’s value is determined by the market. Essentially, it’ll come down to what a ready, willing and able buyer is willing to pay for a property like yours in your neighborhood.
Get Your Comparative Market AnalysisThe most important tool to help you gain an understanding of your Denver real estate property value will be a Comparative Market Analysis (CMA), ideally compiled by a competent Realtor. The analysis should be easy to read and understand, and it should be prepared with recent and relevant comparable sales in your area. You should also be able to review other neighborhood statistics and information so you have context for your Denver real estate home value.
Now, Zillow offers Zestimates, but the nuances of pricing must be done with more expertise for the purposes of pricing an individual property for its respective market. I like to take at least four or five, or more, properties to review and compare to the subject. My clients find it helpful to see other properties marked up or down for various “assets” or “deficiencies” compared to the subject (their home to sell). This is something that Zillow cannot do, which is why those Zestimates are notoriously inaccurate.
The valuation often turns into a discussion. Clients are often able to provide input or context for specific properties, and they learn details (such as seller subsidies, or whether a buyer purchased with cash) not readily available to the public. After careful analysis and discussion, we should be able to pinpoint and agree upon the value of your property.
Price Range & Price
A 500K property might price anywhere from $480K to $525K. Once you’ve determined your value, you’ll want to take into account the current market conditions as well as your goals and needs to decide where you’ll price within the range. It takes a certain amount of psychology and strategy. For example, with low inventory in a hot time of year, you might price on the low end to shore up a bidding war. But, if there are fewer buyers out there or inventory spikes, this strategy could backfire.
- Eyeballs are important –most serious buyers are online, looking at searches they or their Realtors have set up, which typically include price caps within their range. $500K or $700K would be common caps, so you wouldn’t want to price just above, like at $705. It wouldn’t be worth the number of eyeballs you’d lose for a presumed $5000 gain.
- Oddball Numbers may cause unnecessary suspicion and confusion. If you’ve priced at $874,372, a buyer might wonder why you did that, and might be more likely to dig for information on you — when really, it’s the house they should be concerned about. As a seller, it’s best to remain anonymous and in the background when you are selling real estate in DC.
- Evaluate and Track market activity once you’re actively listed. Have other listings come on? Has another property gone under contract when yours didn’t? Keep up on the competition in your neighborhood as well as other neighborhoods buyers would be considering. Also, pay attention to the feedback you get from the showings. Have buyers voiced any objections? A Realtor is a helpful buffer and gatherer of information here — Buyers are much more willing to share their true feelings with a professional agent rather than with an owner. And the truth is what you want.
- Have a Plan of Action If your property gets a good number of showings on a regular basis, then, congratulations! You’re in the right price range. But…. if the showings stay regular with no offers, or if the number of showings tapers, you’ll want to find out why (that’s why feedback, mentioned above, is so important!) Be ready and willing to adjust your strategy in order to keep to your goals. After a set period of time (the number of days you give it will depend on market) you’ll want to check in with your Realtor and assess your strategy to make sure you are reaching the right audience.
Though DC’s real estate market still favors Sellers, today’s Buyers are extremely savvy. Make sure you get your best price by making your property look its best for its price and your market.
Of course, you don’t want to give your house away! Read about the record prices I helped seller clients obtain earlier this year.
Is your house special or is it “special”? Read about this unique house where we exceeded Seller’s price expectations.