Home pricing is part math, part art.
Home pricing is the first of the “3-Ps” to selling your Seattle area home quickly and at the highest possible price. The second P is Preparation (Home Staging), and the third P is Presentation (Home Marketing).
Gerhard’s 3-P system is a proven method of listing and selling in any market conditions.
Home Pricing – the first P of the 3-Ps
“What’s my home worth?” is the first question a home seller asks. A Comparable Market Analysis provides the basis for establishing a price range. However, the final answer to the actual list price depends on the successful execution of the other two Ps, Preparation (Home Staging), and Presentation (Home Marketing). Equally important is a list price that attracts buyers who are searching at the lower end of a price range AND those looking at the higher end of a price range.
Home pricing is time-sensitive. Local competition may force a last-minute change in the listing price. In any case, on the day of the listing, the answer as to what the listing price should be will be self-evident.
To price your Seattle home to sell, we will consider six factors.
- Economy (interest rates, employment, consumer confidence)
- Competition and Market (neighborhood, local supply & demand)
- Location (distances, commute, schools)
- Character and Function (size, appearance, style)
- Public records (automatic valuations)
- Motivation (reasons to sell, timing)
Mortgage interest rates continue to be attractive at historic lows. How rates are kept this low and if that’s sustainable is the subject of much debate. While Seattle is not immune to the tampering by the Fed, the Seattle economy looks pretty good by almost any measure. That’s why people move here. Consider this when the time comes to sell your Seattle area home.
2. Competition and Market
Even when the local economy flourishes, consumer confidence can be shaped by a steady diet of negative news. But if you have good reasons to sell this can be good news in a market with less than an average inventory of active listings. Remember, home pricing is part math part art.
Homes near centers of employment are scarce. This is true for condos near Amazon in Seattle and homes near Microsoft in Redmond. Urban real estate with first world necessities like hot yoga is in short supply. Millennials are willing to be without a car in exchange for a home or condo with a good wall score and decent public transportation. Homebuyers with children of school age are looking to move into the best school district. Consider these kinds of scenarios when the time comes to home pricing.
4. Character and Function
The buyer most likely to buy your home is somebody just like you. If your home was perfect for raising three children, it will be the same for a buyer with similar needs. If you like your condo because it allows dogs and has secure underground parking, so will the prospective buyer. If you pay a premium for a glorious view, the next buyer will be looking for the same and won’t mind paying a premium. Understanding how many buyers are looking for a home exactly like yours influences pricing.
5. Public Information
Buyers will check out whatever online information is available about your home. They may look for at the county records of your home. You may want to correct the outdated and wrong information. Buyers will also find automated estimates of your home’s value on real estate portals that collect data from various sources. You may disagree with the estimate of your home’s value. In any case, this information has an impact on what potential buyers think your home is worth.
6. Your Motivation to Sell
Your motivation to sell will play a role in home pricing. Are you ready to move to sunnier climes to retire? Do you need more space for a growing family or downsize because the kids have flown the nest? Are you tired of being an absentee landlord? Has there been a familial status change or hardship and you have no other choice but to sell? Do your circumstances dictate a quick sale?
Published originally as the 37th issue of The View from the Street.
Next, the second of the three Ps: Home Staging
Here’s a quick summary of Gerhard’s 3-P System for selling your Seattle area home successfully.