It’s almost spring and in many parts of the country the housing market is already starting to thaw. Some markets like Denver, Seattle, and Portland are red hot. According to the S & P CoreLogic Case-Shiller National Index, prices nationwide are up 5.6 percent as of November 2016. Pricing your house correctly and increasing appeal with low-cost, high-value upgrades can mean more offers.
The Price is Right
There’s generally two schools of thought in regard to listing price. One philosophy is to list at top price and lower the price progressively until it sells. Sellers who choose this strategy are usually in less of a hurry and more risk averse. A second strategy is to list slightly under expected sales price. These sellers are usually trying to sell faster and hope to bring multiple offers, boosting the final selling price. The latter is, counterintuitively, the better strategy for getting the most money for your home. Here’s how to do it:
Price Under a Typical Search Limit
If you home is worth $400,000, set your listing price at $399,000. This way, you capture everyone who might be setting their search ranges at $400,000 or less. Like how products are priced at retail stores, psychologically, a price that ends with 99 appears to be a better value. Better yet, such that it deviates from both, such as $397,400 which studies have shown also increase the perception of value.
It might seem risky to underprice your home — what if your home is worth $400,000, you list for $375,000, and the offers all come in at only $375,000? First, that’s your home’s actual market worth. Two, if you receive offers you don’t like, you can counteroffer or decline them. Listing your home under value creates a psychological sense of urgency. You want buyers to visit your home and become attached enough to put in an offer. If enough people do this at once, you have created a buyer frenzy and increased your chance for multiple offers and escalated prices.
Use Comprehensive Comparables
Your agent should create a comparative market analysis of recently sold homes but also those currently active, expired and off-market. What is selling is as important as what is not. According to Zillow, ensure your home is priced within 10 percent of the average home price in your area. If there are few sold comparables nearby, price your home 10 percent under any currently active or expired listings.
Home Improvements Before Listing
There are many home improvements that might enhance your home’s value, such as putting in an expensive new kitchen or bath, but stick to the lowest cost for the highest possible value. Your goal is to make a positive first impression and sell your home quickly.
Replace Tired Flooring
If your carpet is more than five years old, has unsightly stains or is starting to buckle, it’s time to replace it. You can replace carpet with carpet but today’s buyers see more value in hard floors. Buyers with kids or pets tend to prefer engineered floors, bamboo, or cork for their sustainability. One continuous floor of the same material also creates the appearance that the home is bigger, creating an impression your home is worth more.
Paint, Paint, Paint
A coat of paint can cover scuff marks and dirt and brighten a room. Did you love flamingo pink for your hallway and forest green in your kitchen? That’s great! But chances are buyers won’t have your tastes so instead opt for neutral colors such as grays and earth tones when readying your home to sell.
Revitalize Your Kitchen
Fully remodeled kitchens are a great return on investment but don’t spend the money if you are looking to sell. Instead, paint them with Annie Sloan chalk paint. Chalk paint looks so good the buyers will barely be able to tell it’s not the original finish. For about $500 you can transform your kitchen in a weekend.