Chicago IL Homes for Sale

Pricing Your Home

How Much And Why?

There are three important factors to consider in determining value when selling your property. They are location, condition, and pricing ... and they are all related.

1. Location: Your property's location and setting influence its value. Typically, a single family home in a quiet neighborhood will sell for more than an identical property on a busy, congested street. Areas that are close to shopping, schools, transportation, and other conveniences will sell for more. Views traditionally sell - whether a great city skyline or trees and water. You have no control over the location of your property, so this factor must either be emphasized or played down in it's marketing.

2. Condition: New construction has always enjoyed a selling edge over resale properties because they have never been used - like a new car, they are all bright and shiny clean. Our goal is to make your property as close to new in appearance as possible ... being sensitive to cost, of course. You have a great deal of control over condition. You can significantly increase the value and decrease the selling time by making sure your property is in the best possible condition.

3. Comparable Market Pricing: If IBM stock is selling between 104 and 108, it does you no good to insist on selling at 112. In the same way, your property must be priced within an appropriate range. You are actually "selling" your property twice ... once to the buyer, and once to the appraiser. The buyer will be more subjective, comparing amenities and determining value based on needs and preferences. The appraiser will be more objective, comparing age, size, and cost-identifiable features of your property with other properties that have sold.

All of these factors must come into play when looking at the selling price of your property. We will apply our experience and expertise to fine-tune the price based on a consideration of these three variables.

Making The Most Of The Market

Pricing1.gifMost often, the most serious buyers (i.e. those who have been out looking, have educated themselves about the marketplace and, are most motivated to buy) will come in first. Buyer and agent interest begins to grow as soon as a property is placed on the market, peaking somewhere during the second week. This means that it is extremely important to price your property properly from the very beginning. The longer a property stays on the market, the less valuable it becomes.

If the property is perceived as priced properly from the beginning, it will create a sense of urgency on the part of those serious and educated buyers that are in the market today. The most ideal scenario for a seller is to have two or more buyers bidding against each other for the property. This is a very real scenario when the property is perceived as an excellent value. When priced properly, it is not uncommon for a property to be sold at the asking price or above.

Pricing2.gifIt may sound contradictory, but to get more money for the property, the best strategy is to ask a little less! The old axiom that says "if you don't ask, you won't get" just does not apply to today's marketplace of educated consumers.

Today's educated buyer will know how long your property has been on the market. They watch for new properties coming onto the market everyday. A property sells for the most money when it is "fresh" on the market. Just like bakery, properties also get "stale" the longer they "sit on the shelf". Therefore, the more quickly a property sells, the higher price a seller can expect to realize. If you want more, ASK LESS!

The Myth Of Overpricing

"Value" is not the same as "market value".
Value is what one person may be willing to pay. Market value is what most educated, informed buyers will pay. Also, in order for a buyer to obtain a mortgage, the lender's appraiser must confirm that the buyer is paying market value, making it extremely difficult for a buyer to pay over market value even if they are willing to do so.

These things may add value for you - but not necessarily market value for a buyer:

"I've put so much money into improvements."
While certain upgrades may increase the value of a property (new baths or kitchens, for example), many things which you consider improvements may not add to market value. (If you are thinking about making any major expenditures in order to sell, please consult us for further details on this point.)

"I really need that much money."
Unfortunately, your need for money does not determine the value of your property.

"I am buying almost the same property somewhere else and it is costing me that much."
Values are location specific. High values in your destination do not increase the value of your current property.

"My friend told me that our neighbor's house sold for this much. Mine is much nicer."
Friends are wonderful, but don't base the value of your property on opinions or what you may have heard through the grapevine. Rely on the expertise of your professional real estate agent, who will make comparisons based on recent documented sales.

"A high price will give me bargaining room."
Buyers may offer low, but they will do that at any price. Inflating the price only prevents buyers from making an offer.

"I don't need to move right away."
Even if the sale isn't urgent, it is important to price correctly to preserve your marketing position. As described above, a property loses value the longer it stays on the market. Better to wait until you are ready to move and put the property on at the proper price than to put it on too high and let it lose value.

Mary Nack
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