Ever wonder what factors matter the most when pricing your home to sell? If you’re about to list your home, you want to make sure that you list it at the right price. You only have one shot to make a first impression with buyers. Since price is such a huge factor for a buyer, it makes sense that you want to price it right.

Pricing your home right is critical if you want to sell it fast and for top dollar. Yes, sellers are in the driver’s seat. That doesn’t mean you can’t overprice your home. I’ve seen it happen, and it can have a big impact on what your home actually sells for.

You might be asking why the list price even matters when we are in a seller’s market? Can you price it too high when it’s such a hot market? The answer is yes. Even in a hot market, like the one we’re still in, you can overprice your home.

As a seller, you want to get top dollar when it comes time to sell your home. I’ve yet to meet a seller that doesn’t have some number in mind when it comes to listing their home. It comes down to pricing. If you want to sell your home fast while getting top dollar, pricing is important.

I often have to remind the sellers I work with this truth. The monetary value they place on their home may not be what a buyer places on it. Homes sell at a price that a buyer is willing to pay and a seller is willing to accept. A home holds value to you, but that doesn’t mean a buyer will have the same value.

One of the biggest mistakes I see sellers make (or want to make) is to list their home at a price THEY are willing to pay. Remember, it’s not about the seller. It actually isn’t even about me, the agent. Rather, it’s about the buyer and what they believe the house to be worth and what they’re willing to pay to get it.

This concept can be offensive to sellers. They see their home through biased lenses. It can also be frustrating for sellers. They’re set on getting top dollar and don’t want to list their house for a penny less.

When I first meet with my sellers, this is one of the first questions I get. “How do you know how to price your home correctly so it sells for top dollar?” This is a great question. I love talking it through with my clients so they understand why we are listing their home at a specific price.

There are 7 factors to consider when pricing a home so it sells fast and for top dollar. It’s important to know these factors. This helps you, the seller, understand why you’re home’s valued at a certain amount.

Factors That Go Into Pricing a Home

#1. What are the comparables

Agents refer to these as “comps”. One of the best ways to know the value of your home is to see what other homes like yours have sold for. A comparative market analysis (CMA) is something your agent will do. It helps when they’re determining a list price.

An agent takes into account these factors when doing a CMA:

Date: When did the comps sell. The more recent the sale date, the better.

How similar are they: Homes that are similar in design, square footage, bedrooms/bathrooms, and year built.

What’s the distance: How far away are the comps. Location is everything and matters when pricing a home.

Location: Is your home located near a park or a transit station? Likewise, is the comp located on a cul-de-sac or a busy street?

#2. Location, location, location

Do I need to say it again? Location’s everything. But you already know that. While your current home might be in the perfect location for you. Maybe it’s near the freeway entrance, close to downtown, or even near your parent’s house. Yet, these aren’t exactly what an agent, or even a buyer, sees as a prime location when determining its market value.

When referring to location, here’s what an agent looks when determining a home’s listing price:

How good are the schools

What kind of employment opportunities are available

Is the home close to shopping, entertainment, restaurants, and other kinds of recreational activities

#3. Size of home and usable space

This is an important factor to mention. It’s true that the larger the home is, the higher the price. Let’s say you have a large home, but a quarter of that square footage is an unfinished basement. That quarter isn’t livable for a buyer. Buyers care most about livable space in a home.

The value of a home is roughly determined by price per square foot. For example, if your home is 1,500 square feet and sold for $300,000. The price per square foot is $200. While some buyers are willing to pay that price. There are others that might think it’s too expensive for the location. That’s why doing a CMA is so important.

#4. Age and condition of the house

A newer home appraises for a higher value. The same is true for an older home appraising for a lower value. In a newer home, things like plumbing, electrical, the roof, and appliances are less likely to break. These items can be savings for the buyer.

If your home is older and in need of a new roof, buyers aren’t as likely to pay a high price. They know pretty soon they will have to spend big bucks for this repair. Buyers ask for an inspection contingency in their offers. This way they can negotiate any repairs needed to the home.

Even making a few updates, changes, and repairs can help with the list price of your home. Here are a few minor things you can do to spruce up your home, which can help increase the list price:

Deep clean

Declutter the yard and any extra storage space

Improve your curb appeal

Give appliance a good wipe down and repair any broken parts

Repaint any interior or exterior walls

These small changes and updates go a long way with buyers.

#5. Renovations to the home

Any updates, upgrades, and renovations you’ve made to your home add value when it comes time to sell. This is especially true with older homes. You might have an older home but have updated the bathrooms and kitchens. This investment goes a long way in the price you list to sell.

Yet, not all updates are equal. What’s an update to you, say a new pool, might be an added expense to the buyer. Before you start a big renovation project with the hopes of a return on your investment, make sure you are aware of how it will affect the value of your home.

National Association of Home Builders recently did a study. The study found that these are the features homebuyers are looking for the most:

Laundry Room: 47% said it’s a must

Walk-in Pantry: 34% said it’s a must

Patio: 33% said it’s a must

Double Kitchen Sink: 42% said it’s a must

Hardwood Floor: 32% said it’s a must

Full Bath on the Main Level: 42% said it’s a must

#6. What’s your local market doing

Your home might check all the right boxes. It’s in perfect condition and in an ideal location. All the upgrades are exactly what a buyer would want. Two things matter when looking at your local market. The first is the number of buyers. The second is how many listings there are like your home. Those determine your home’s value.

While we are still in a seller’s market, we won’t always be here. Knowing the number of homes for sale and buyer demand in your area will play a major role in your home’s list price. If there are many homes like yours on the market, buyers won’t pay more than the price of those homes. Overpricing your home could backfire if buyers know they can get the same thing at a better price.

#7. What’s the economy doing

This is more than your basic supply and demand. We all know when supply’s low and demand’s high, prices increase. You want to also pay attention to what’s going on with the employment rate and interest rate. As well as what’s happening with the price of goods and services. These all have an impact on the housing market.

You want to work with a knowledgeable, skilled, and experienced agent. Thi is the best way to make sure your home’s listing price is competitive. Your goal should be to get your home in a multiple offer situation. Then you let the buyers drive the price up. Listing too high could actually cost you money in the long run.

Are you looking to sell and want to list your home competitively so no money’s left on the table? If so, contact me, Wendy Bathgate. I am a local agent in Kitsap County, WA. I would love to chat with you and make sure that you get the best offer for your home.

Contact me, Wendy Bathgate, today and let’s talk about your options.