Pricing Your Home: Use Multiple Comps for Best Results
We often hear from home sellers that they will only accept an offer at $X+ price because their home is superior to another home in their neighborhood that just sold for $X. We caution such sellers to be very careful. Here's why.You can easily get tripped up by small data samples and decline offers you might otherwise accept. For example, we recently had a property in San Mateo listed at $599,000. Six to eight offers came in between $660,000 and $680,000. However, one offer was $740,000. The seller accepted it and closed 30 days later.
- Is the fair market value of the seller's condo $660,000 to $680,000 or $740,000?
- Did the $740,000 buyer drastically overpay or did they get the condo at fair market value?
- If the neighbors list their condos and turn down offers at $680,000, are they smart or foolish?
There isn't a correct answer to these questions. We just use the examples to illustrate the challenges. But these exact questions make a compelling case for why you should consider multiple real estate comps (meaning, recently sold home prices for similar properties in your neighborhood) when you determine your list price. By doing so, you're giving yourself the best opportunity to value your home based on your neighborhood's pricing trends.
Ultimately your final sales price is dictated by the offers your property receives after you list. Within 30 days of listing, you'll know if you priced too low, too high or just right.
Questions about pricing? Ask us!
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