This week I was in a listing class with an instructor with many years of experience in real estate. Everyone in the class agreed and discussed just how difficult it is right now to comp and price a house. Even with my Pricing Strategies Advisor certification, it is a confusing time for pricing a house to sell. Let me explain why.
All the comparable closed listings prior to November were sold in a uniquely crazy seller's market with bidding wars and low interest rates on top of the high demand. Anything that sold earlier in the year was even much more crazy and had record-low mortgage interest rates. Those times are just about gone and we are in a shifting market. Trying to use homes sold over the past year in order to price a new listing is very difficult and a little bit tricky.
The price of a home is not a price tag. It is an attempt to hit the perfect market value based on the demand of buyers in the market to buy. Price is dictated by the market. It really is best to hit the nail on the head and be at the right price or just under. Pricing a house too high will eventually need to be adjusted down. This might create a negative impression in the minds of buyers and real estate agents. Many will automatically assume that something is wrong with the home. If a home is priced slightly below an estimated market value then the interest from buyers will be much greater. More showings can lead to a full-priced offer or maybe even an over-asking bid.
In most cases, houses are being financed which means the house must appraise at or above the sale price or the financing will not go through. The options to remedy a home not appraising will be that the buyer will need to bring the difference to the table; the buyer will have the option to walk away, or the buyer and sellers have the opportunity to renegotiate the price down to the appraised value.
Pricing your home is more of an art than a science. It takes an analysis of the style, age, size, finishes and updates of your home along with some critical thinking about the region, neighborhood, and market. The data is very important too so looking at comparables is key but it will also need a little gut instinct to round out the entire process of pricing your home right. We will work together to come up with the right price but ultimately in the end the seller dictates the final listing price.
If you are thinking about selling in the near future, let's have a chat soon and talk about listing your New Hampshire home. I would love to come by for a visit to begin gathering information to help you get the ball rolling.