How Is a Home’s Price Determined?

What all goes into the process of determining how much a home is worth? Today I’ll talk you through four elements that affect a home’s pricing.

Selling your Massachusetts home? Get a home value report

Buying a Massachusetts home? Click here for full MLS access

What are some of the elements involved in determining the price of a property? Knowing these details can make all the difference if you’re trying to sell your home:

1. What are the comparable sales? Comparable sales are homes that have sold in your area that have similar characteristics to your home in terms of the size, the amount of land the property affords, and the types of amenities, benefits, and other features. All these factors can help determine what price buyers will purchase your home for.

2. How many homes in your market recently expired? The reason homes tend to expire from the market is that they were too expensive or they didn’t offer the features and benefits necessary to justify the price they were listed for. Expired listings can actually lend some degree of information about how you as a seller can avoid overpricing your home.

All these factors can help determine what price buyers will purchase your home for.

3. What is the competition like? If your home is similar to many other homes on the market, then there will likely be a lot of competition among buyers for it. This will impact the value of your property, possibly restricting the potential upside you can get from the sale.

4. What are the unique aspects of your property? Is it a waterfront home? Does it have a unique setting on a hilltop with a magnificent view? Does it have special electronic features?

If you look at these various elements and incorporate them into the big picture, it enables a professional real estate agent to provide you with an accurate read on what the value of your home is. From there, you can have a conversation with your agent about whether or not to price your home above, below, or at market value in order to maximize interest among buyers.

If you have any questions, thoughts, or concerns about pricing your home for the market, please reach out to us. We’d be glad to help you out.

Selling on Your Own vs. Selling With an Agent

Selling your home with a professional agent means they can use all their skills to sell your home quicker and for more money than you could by selling it on your own.

Selling your Massachusetts home? Get a home value report

Buying a Massachusetts home? Click here for full MLS access

The primary distinction between FSBOs and professional real estate agents is that agents have a series of skills and talents they can apply to a home sale to enable that home to sell for substantially more money.

Specifically, there are seven skills a professional agent uses to help a home sale reach its full potential:

1. Pricing the property. This requires a high level of awareness of all the ever-shifting economic factors that make up the real estate industry.

2. Mobilizing other real estate agents to sell the property. An agent can broaden the scope of a sale by mobilizing agents within their company, agents beyond their company, and agents from outside of the area to help sell it.

3. Qualifying buyers. This isn’t as easy as just looking at a pre-qualification sheet that was produced online. Oftentimes, these pre-qualifications aren’t worth the paper they’re printed on.

Negotiating contracts is a skill that makes all the difference in the world when someone’s been practicing it for 10, 20, or 30 years.

4. Negotiating contracts. This is a skill that makes all the difference in the world when someone’s been practicing it for 10, 20, or 30 years.

5. Navigating home inspections. Home inspections can create a wide variety of scenarios within a home sale, and being able to negotiate the issues in each scenario is critically important.

6. Preparing for an appraisal and enabling the appraiser to optimize the property’s value. This skill requires being able to gather comparable sales and embellish the sale at the maximum opportunity to provide value.

7. Showing multiple homes. FSBOs won’t be able to show multiple homes in order to maximize the interest in their own property.

If you have any other questions or concerns about the differences between selling as FSBO and selling with a professional agent, don’t hesitate to give me a call or send me an email. I’d be happy to help you.