Setting the right price is the most important step when you’re selling your home in the Iowa City area. Sellers may already have an idea of what they think their homes are worth. The question is, will it tally with what buyers are paying for homes in the neighborhood?
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 how long it takes to sell them. When we look at the other ways of estimating the value of a home it soon becomes apparent 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. This is especially true if the neighbor’s house has been on the market a while, in which case it’s likely it is overpriced and he has a price reduction in mind – Probably right after you list your home for sale!
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 as sellers do. The fact that a seller put $50,000 into the house since purchasing it 5 years ago won’t mean a lot to a buyer. Buyers expect homes to be maintained and improved on. It’s possible that the work done is not an “upgrade” to them. Updates that are recognized to add value by buyers include installing hard wood floors or granite counter tops. The new roof or water-proofing the basement are maintenance items and not a reason to list at a higher price.
Best Price – Market Value
When pricing a home, the best price is calculated by looking at your house and comparing it to similar houses that sold recently. It goes without saying that a great house in great shape in a sought after neighborhood will be easier to market and sell than a house needing work. Here are a few of the things a good agent will consider. How is the market trending? Are home prices on the rise or are they declining? 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 sellers need to know the answer to when pricing a home at the top of the market. The time of the year sellers decide to list their homes is a factor too. As a rule of thumb, spring time is the best time to shoot for the highest price. Every year almost 50% of homes sold in the Iowa City area sell in the spring and summertime. That means listing a home in the early spring gives sellers in the Iowa City area the most potential to reach the largest number of buyers. More buyers means more competition for a property that may lead to a higher price.
The market analysis is a very important step in the home selling process. It will help you position your home correctly on the market for a quick sale. Most real estate agents offer a free market analysis. If it’s free it can’t be worth much, right? Well, that’s an incorrect assessment about the value of a CMA. Or at least it is if it’s prepared by an agent who really knows the Iowa City area real estate market and can offer good solid advice along with the data…
Are you looking for the right Realtor to help you navigate the complexities of the real estate market, all the while looking out for you and your money? Sound advice and guidance is just a phone call, text or email away. Call Denise now at 319-400-0268.