Friday, December 11, 2015 / by Bill Berning*
Pricing an older home can be tricky because it may only appeal to a segment of potential buyers. However, like any property, there are things that you can do to ensure that you list the home at a price that provides the most value to potential buyers.
The price you can offer on your mid-century home will not only be tied to its condition, but is also based on other factors, such as the market value and current local market conditions. Selling an older home often requires more research than selling a newer home. However, the same principles of a sound pricing strategy still apply.
As you work with a realtor to come up with a pricing strategy for your home, it is important that you keep in mind the importance of getting the strategy right the first time. There are many factors that can influence whether or not you get quality offers on your home and you don’t want your price to be one of them.
The importance of finding a quality Realtor to represent your property is even more pressing when you need someone to help you sell a home that might not be in the best condition. Here are a few tips on pricing strategies for mid-century homes that you can use to come up with a strategic plan.
Comparative Market Analysis
If you hire a real estate agent to represent your property, you will receive a Comparative Market Analysis, or CMA, as part of the services provided by the agency. A CMA will provide information on the recent sales and days on the market for other homes in your area.
When it comes to age, the older your home is the more data you will need to compile to get an accurate idea for an asking price. “As a guideline, the older your house is the larger range there is in comparables. A home that is 80 years old is likely similar to a home that is 90 years old.” says David Cross, Content Editor at Movoto.com.
This type of analysis can often be done without the agent even having to come to your home. This should be one of the first reports that you look at when trying to determine the price for your home.
Create Incentives for Potential Buyers
Older homes often need to be updated in order to become energy-efficient. You can offer this fact as a major selling point for your home, if you do the research first. Obtain estimates to determine how much for updates to outdated appliances and energy systems. Your Realtor may even suggest building the cost of the upgrades into the asking price. The real estate agent should also remind potential buyers of energy tax credits that are available in certain states.
In addition, upgrades to make homes more energy-efficient also make the home more livable. This could mean an increase in value for potential home buyers that are willing to make the investment. This fact should also be reflected in the pricing strategy for your home.
Create a Contingency Plan
If you are trying to get your home to sell for top-dollar, it is a good idea to come up with a contingency plan. Your plan should specify exactly what you plan to do in the event that buyers simply aren't interested in the home at the initial asking price. As a seller, you may not believe that this will happen, however you should nevertheless be prepared. Having such plan not only saves time, but will also remind you to set realistic expectations for the process of selling your home.
As you try to decide on the appropriate price for your home, it is important that you consider the price range category that your home falls within. As of Brendon DeSimone of Zillow.com explains, “Most buyers tell their agent they want a three-bedroom home in a certain neighborhood under $500K (or some other dollar amount). Their real estate agent may then set up an automated buyer search in their local database for properties under $500K. But if a home is listed at $510K, that buyer will miss it. So, if your list price is higher out of the gates, you may miss a segment of buyers.”
Therefore, it is important that you work with an agent to come up with a good price that is not so creative that your home will not be found among the search results for comparable homes in your area.
If your home has been deemed historic by the National Register of Historic Places or by a local board in your area, this should definitely be a factor in pricing your home. In addition, to the historic value provided by the neighborhood, homeowners often qualify for tax benefits for having made the investment in a history home. This may be a selling point that may make your home more valuable to certain homebuyers that you can use to your advantage.
Hire a Realtor
Instead of pondering pricing strategies that have not been proven to work in every case, it is a better idea to hire competent Realtor that has plenty of experience with selling comparable homes in your area. By working with a Realtor that has specialized experience in the types of homes in your neighborhood, you can increase the chances that your pricing strategy will be a success.
Regardless of the price that you select, ultimately it is up to you to make the decision on the best way to get the returns from the property that you are looking for. By working with an experienced agent, you can come up with a realistic plan of action that is focused on success.
*This article is syndicated and licensed from Realtor.GetWrittn.com.