A comprehensive market analysis is essential to determine the value of residential property. Location and characteristics of the property are the key elements in determining value, therefore the basis for valuation is similar properties in your area. The market analysis takes into account the amount received from recent sales of comparable properties and the quantity and quality of comparable properties currently on the market. The desired end result, of course, is to find a price that will attract a willing and able buyer in a reasonable time.
Once the value of your home has been determined, you can decide on an offering price that will achieve your goals. Generally, the price should not exceed the value value by more than 5% or potential buyers may not even make offers. Naturally, if you want to sell quickly your asking price should be very near the value.
The following are a few things to keep in mind about pricing:
- Realistic pricing will achieve a maximum price in a reasonable time.
- Your cost or profit desire is irrelevant; the market determines the price.
- The cost of improvements are almost always more that the added value.
- Houses that remain on the market for a long time do not get shown.
- A house that is priced right from the beginning achieves the highest proceeds.