How much to list your home for? Listen to the experts
Putting a price on what is likely your most valuable asset can be tricky, especially if you have lived in your home for a number of years and have done it up just the way you want it. In your eyes, it may be the best home on your street. When it comes time to sell, perhaps to move to a new job or give your growing family more room, it is hard not to take it personally when your realtor rolls up and suggests that it is worth $100,000 less than the sale price you had in mind.
People get it into their head that “My house is worth whatever, I say its worth.” No matter who you are, you always think your home is the best. It’s not a slight against other homes, it’s human nature.
However, if potential Buyers do not feel quite the same way about your magnificent home as you do, you could find yourself waiting in vain to secure a sale.
If you can’t sell your home, it’s usually because of the price, says most realtors. If there is no obvious reason like, needing to de-clutter or bad pet odour then it’s price. What someone is willing to pay is what determines the market value.
Unless your property has a unique feature such as an indoor swimming pool, which may only appeal to a limited number of Buyers, it should be fairly straightforward to pinpoint the value of your property and, subject to market conditions, secure a reasonably quick sale.
If you don’t get a showing in a week, there’s a problem. You should be getting at least a showing a day; if you’re not, then your price is way off. If you are getting 10 a week and 50 people are coming through in a month and it hasn’t sold, then it’s obviously not just the price…they’re coming and looking, but for some reason they’re not pulling the trigger. There may be issues unique to each property that are putting off the Buyers, but they argue this is usually something obvious such as that old pink carpet, the aging roof or the poor paintwork. No matter how you look at it… you are really still talking about price.
If you home is not moving for the price you’ve got it at. Start sprucing it up; add value for the money. If you don’t want to change the price, then you have to give people more for the money to justify it.
Realtors warn clients unwilling to drop their price that the longer a home is on the market the less bargaining power they have with Buyers. For those Sellers unwilling to shift on price, there is the option to move to a new home and rent out the old one until it sells at the price they want. However, financial planners caution anyone thinking of going this route to take a hard look at the costs.
The main question to ask is “what does it cost me to keep my existing property and rent it out versus how much would I have had to reduce the price in order to sell it. Potential Sellers much consider capital gains implications when selling a home that is not a primary residence, the time and cost of keeping a second property, as well as whether you can in fact afford to support two mortgages, Your calculations may reveal that the prudent choice is to lower the price of your home, secure a sale and move on.
Helen Morris – National Post Sat Oct 23, 2010