Guess what? It doesn't always work that way. Sorry.
Wouldn't it be great to decide how much you want to sell your home for, list it, and have buyers pay that amount so you can move on to your next home with the cash you want in your pocket. Very few things make me cringe more than hearing a seller toss out a figure they need to net from the sale of their current home.
When I show up at a listing appointment, I am armed with the latest sales (comparables) that closely match the home. After walking through the house and getting an idea of what the home has to offer, I sit down with the homeowner and discuss those sales along with the condition of their home. The idea is for us to price the home so it will sell and appraise.
Why should we let the market decide the price of your home and not the current owner? It really does make sense even though your wallet is saying no!
First, put yourself in the buyers shoes. You love a certain neighborhood and are planning to look at 5 houses there today. 4 are priced within $10,000 of one another. 1 is $35,000 more and really doesn't have much more than the other 4. When you decide to write an offer, are you going to choose the one that is overpriced compared to all the others or one of the other 4 that seem reasonable?
When a home price is unrealistic, buyers may think the seller will be unreasonable in their negotiations and some will not even consider looking at the house or writing an offer so the house sits on the market. You probably wouldn't go to a dealership and spend $35,000 more on a car when another dealership has that exact same car on their lot for the lower price. Buyers will generally not do it on a home either.
Also, the home is probably going to be appraised so you need to be able to justify the price. I can slap a $500,000 price tag on a $200,000 home any day of the week. If I am lucky enough to even get an offer, I better be able to show why the home is worth $300,000 more if I want the loan to be approved! Remember, appraisers also review the recent sales in the area so they are looking at the comps too.
This doesn't mean that your home is always worth less than what you think it is! There are certainly situations where we can show the home has more square footage, bathrooms, bedrooms, etc to warrant a higher price tag. The comps are there to give us a baseline. The price may go up or down depending on the comparison.
You may even be lucky enough to walk away with more than you planned on!
Wouldn't it be great to decide how much you want to sell your home for, list it, and have buyers pay that amount so you can move on to your next home with the cash you want in your pocket. Very few things make me cringe more than hearing a seller toss out a figure they need to net from the sale of their current home.
When I show up at a listing appointment, I am armed with the latest sales (comparables) that closely match the home. After walking through the house and getting an idea of what the home has to offer, I sit down with the homeowner and discuss those sales along with the condition of their home. The idea is for us to price the home so it will sell and appraise.
Why should we let the market decide the price of your home and not the current owner? It really does make sense even though your wallet is saying no!
First, put yourself in the buyers shoes. You love a certain neighborhood and are planning to look at 5 houses there today. 4 are priced within $10,000 of one another. 1 is $35,000 more and really doesn't have much more than the other 4. When you decide to write an offer, are you going to choose the one that is overpriced compared to all the others or one of the other 4 that seem reasonable?
When a home price is unrealistic, buyers may think the seller will be unreasonable in their negotiations and some will not even consider looking at the house or writing an offer so the house sits on the market. You probably wouldn't go to a dealership and spend $35,000 more on a car when another dealership has that exact same car on their lot for the lower price. Buyers will generally not do it on a home either.
Also, the home is probably going to be appraised so you need to be able to justify the price. I can slap a $500,000 price tag on a $200,000 home any day of the week. If I am lucky enough to even get an offer, I better be able to show why the home is worth $300,000 more if I want the loan to be approved! Remember, appraisers also review the recent sales in the area so they are looking at the comps too.
This doesn't mean that your home is always worth less than what you think it is! There are certainly situations where we can show the home has more square footage, bathrooms, bedrooms, etc to warrant a higher price tag. The comps are there to give us a baseline. The price may go up or down depending on the comparison.
You may even be lucky enough to walk away with more than you planned on!