Setting the right price is arguably the most important step when you’re selling your home in the Iowa City area. You may already have an idea of what you think your home is worth. The question is, will it tally with what buyers are paying for homes in your neighborhood at the moment?
There are a few different ways to calculate the value of a home. When it comes to selling a home in Iowa City the only one that makes any sense is a Current Market Analysis. This is because it takes into account exactly what buyers are paying for similar homes and the time frame they sell in. There are still more sellers than buyers in the Iowa City real estate market making this step more important than ever.
Let’s take a look at the other ways of estimating the value of a home and you’ll soon see why when it comes to selling real estate in the Iowa City area the Market Analysis is the superior choice and most commonly used by real estate brokers.
List Price – Market Value
Often times sellers think pricing their house the same as the neighbors is a sure way of attracting buyers. The only time this is likely to be successful is if you know for a fact that the neighbor priced his home based on previous sales in the neighborhood. (Or even better that he has an offer on the home). Without inside information on how he came at his listing price, setting your price in line with his will not work. (Especially if it’s been on the market a while, in which case you’d definitely be shooting yourself in the foot as it’s likely he has a price reduction in mind – Probably right after you list your home!)
Cost – Market Value
Another way to look at the value of a home is through the cost approach. The difficulty with this approach is that buyers don’t see the value the same way. If you paid $200,000 for the house 5 years ago and put in $50,000 in upgrades, that doesn’t mean you can expect to get $250,000 when you sell the house. Buyers expect homes to be maintained and improved on. It’s not an “upgrade” to them. It’s possible that you will see some return on your investment, but it won’t be the full amount you paid, it will depend on market conditions and what similar homes are selling for. (As I talk about the different methods of estimating value you’ll see that it keeps coming back to market value).
Best Price – Market Value
When you list your home you obviously want the best price possible and there will always be a range to work within. The best price is when you look at it through the lens of “best case scenario.” You have a fantastic home, in great shape in a sought after neighborhood. You should get top dollar for it. The question is, are we in a market where homes are appreciating in value or declining in value? What are the chances of you getting an offer within a couple of days of the house going on the market? How big is the pool of buyers looking for a home in your neighborhood? These are key questions you need to know the answer to when you price your home at the top of the market. And guess what, to figure that out you’ll need to know what homes sold for in your neighborhood in the last few months and what kind of prices they got. You’ll also need to factor in the fact that the peak selling time of the year is coming to an end and the chances of the perfect buyer walking through the door tomorrow are less than they were in May. In short, you’ll need that pesky Market Analysis that real estate agents are always eager to share with you. Why? Because we know it’s a great starting point to establish the most realistic price and the time frame you’ll likely need to achieve that price in today’s market.
Are you getting ready to sell your home the Iowa City area? Do you want to know what your home is worth in today’s market? As an experienced Realtor in the Iowa City real estate market the information I share with you will be detailed and complete. Contact me for a Free Market Analysis or Call 319-400-0268 Today.