Setting an Asking Price for Your Home

Determining the possible market value of your home is not a simple task. If you set your asking price too high you may be turning away potential buyers and risk further problems with getting a good price after you  are forced to reduce the price. Setting the asking price too low could mean leaving too much money on the table, or buyers not seeing the value in your home, or create a bidding war (you may or may not want a bidding war).

If you are listing your home with a realtor you could consult with them to determine a price. But be aware that some agents tend to price homes a little low so they can make a quicker sale and collect their commission. If the price they suggest seems a little low you could consider adding 5 to 10 % to your asking price.

Look at real estate listings in your area to see what homes similar to yours are going for. Getting a feel for the market will help with deciding on your price.

Check recent comparable sales. The price similar properties have sold for in your area will closely reflect market values. Use this information to assist with determining your asking price.

Do not fall into the trap of listing a high price with the intention of lowering it later if there is not enough action at the higher price. After lowering your price you may be seen as desperate and buyers may then give you low ball offers.

Setting the asking price too low poses many different possible problems. If the price is set very low, buyers may ignore your home all together if they perceive that there may not be sufficient value in the property. Setting the price too low also means you may not receive as much money as you deserve. Or it could spark a bidding war as buyers offer and counter offer to buy your home. A bidding war would allow you to get the most money possible for your home but it often leads to deals that fall apart before closing.

Ideally you should set a asking price that is very near the market value with some flexibility to move up to 10% either way if needed.

Read more on Asking Price vs. the Selling Price

Taking Offers on Your Home

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