How to Price Your Home When Putting It on the Market

How to Price Your Home

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Every year, over 5 million existing homes are sold in the United States.

Most of these sellers hire real estate agents to oversee the selling process, but there are those who opt to sell on their own. Selling your home on your own cuts off the middleman, which means you’ll end up with more money in your pocket.

However, when taking the for sale by owner path, one of the things you’ll need to get right is the pricing of the property; otherwise, you could underprice or overprice it.

Here’s a guide on how to price your home like a pro.

Know the Prices of Comparable Homes

There are probably homes that look like yours, in terms of plot size, house size, and build quality, in your location. Since the properties are in the same location, they would fetch almost equal amounts when sold.

As such, the first step to pricing your home correctly is to find out what comparable homes in the neighborhood are going for. If there are multiple properties like yours, the better. This will give you a really good ballpark figure.

For instance, if there are 10 comparable homes in the neighborhood and they’re ranging from $250K to $300K, there’s a strong chance yours will fall in this range too.

Establish Whether Your Home Needs Repairs

You always know when your home needs repairs, right?

Well, not quite. While some damages, like a cracked ceiling or leaking pipes, are easily visible, others can remain concealed for a long time. For instance, it’s almost impossible to know when your home’s foundation is starting to develop lines of weaknesses unless you’re a professional home builder.

It’s advisable to hire a home inspector to unearth everything that might need repairs. When you have a clear picture of the property’s structural integrity, it’s easier to price it properly.

If you don’t know the repairs the property needs, you might overprice it. Bear in mind most potential buyers will ask for the inspection report or show up with their own inspectors.

An inspection will also help you decide whether to make repairs or sell the home as is. If you opt for the latter, you’ll certainly be asking, “what is the best way to sell my property as is? Hint: look for cash buyers!

Be Strategic With Your Price points

Grocery item A costs $10. Grocery item B costs $9.99. Which would you buy?

If you’re anything like most people, you’ll fall for item B. Not because it’s less than a penny cheaper, but because it costs under 10 bucks. It’s all human psychology.

The same psychology applies when people are shopping around for homes. Price your home with this element in mind.

For instance, if your home’s market value is $300K, pricing it at $299,900 will make it more attractive than if you priced it at $300,000. The difference is just 100 bucks, but what matters to the buyer is they snapped it up for under $300K.

Know How to Price Your Home Correctly

Selling a home is a big decision, especially if you want to sell it yourself. One of the challenges you’ll face is setting a price, but with this guide on how to price your home, you’re in a better position to do it right.

Keep reading our blog for more homeownership tips.