For Sale by Owner News and Articles
Price It Right
By Broderick Perkins
Before pricing a home to sell on your own, let's make one thing perfectly clear -- the amount of money you expect to save on commissions is pretty much what the buyer innately expects to see lopped off the bottom line.
"As owner, you tend to look at your home through rose-colored glasses. Plus, you want to save money on the commission. Those two things will incline you to over-price the property," said Blanche Evans, Dallas-based author of "homesurfing.net: The Insider's Guide to Buying and Selling Your Home Using the Internet," (Dearborn, $17.95).
However, only documented evidence will sell buyers on the price you set.
Here's how to get it right.
Appraise your home.
Hire a certified appraiser. Appraisers have a data base of recent sales to compare with your home and will give your home the once over. The appraised price will add or subtract value based on differences between the data base and the visual inspection.
"When the buyers come through, keep that appraisal in eyesight so that the buyers are seeing the appraisal and they can't hedge," said Davenport, Iowa-based broker Bonnie Sparks, author of "If You're Clueless About Selling Your House," (Dearborn, $15.95).
Ask the appraiser how you can maximize the sales price. They are in the business to recognize how various factors affect the value of a home.
Compare and contrast.
On-line comparables services offer home value data. The best services cull the data from the public record as soon as it's recorded. Dated data isn't useful in a hot market.
Check other asking prices.
Keep track of the sale price range for your street and immediate neighborhood. That's how much buyers are willing to spend in your area. Use the local newspaper to monitor asking prices. Visit open houses in your neighborhood to check on their condition, amenities, floor plans and other physical attributes. Try to determine why homes in the same area sell for different prices.
"Don't confuse asking price with selling price. As a general rule, asking prices are at least 10 percent over the market,"" said San Francisco broker George Devine, author of ""For Sale By Owner In California" (Nolo.com, $24.95).
To set your price, gather the appraised price, comparables and asking prices, and begin with your price set somewhere near the middle.
Devine says, generally, if 25 percent or more of the homes sell within seven to ten days of being listed, the market is hot. If more than half the homes languish for more than 30 days and sell for less than asking, the market is cool.
"If your price is unrealistic, a buyer will have a hard time getting financing if the lender's independent appraisal shows the price to be seriously inflated," Devine said.
Broderick Perkins, has been a consumer journalist for 20 years. Experienced in print, electronic, and consulting journalism, he is chief executive editor of San Jose, CA-based, DeadlineNews.Com, an editorial content and consulting firm.