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If you’re planning to put your home on the market, you obviously want to earn as much money as possible from the sale, but you need to set a realistic asking price. There are many factors beyond your control that can affect the amount of money buyers would be willing to pay for your home, and pricing your house incorrectly could cause it to languish unsold for weeks or months.

Look at Comparable Home Sales
You and your real estate agent should discuss the characteristics and sale prices of houses comparable to yours that were sold in the same limited geographic area in the past few months. The homes you use for comparison should be similar in terms of age, square footage, amenities, and proximity to highways, stores, restaurants and community resources. The closer the other houses are to yours in all these aspects, the more helpful they will be as a frame of reference when you’re setting an asking price for your own home.

Your agent will be able to gather data on the original list prices vs. final sale prices for the comparison homes. The agent should also be able to find information on similar houses that were listed, taken off the market and later relisted, as well as any changes to their asking prices. In some cases, it might also be possible to gather data on the agreed sale prices for houses that are under contract but haven’t yet closed.

How to Set the Right Asking Price for Your House
This data can help you assess the overall local real estate market and price your own home accordingly. If many owners lowered their prices to sell their homes, it’s a buyer’s market. You should set a price for your house that will allow you to negotiate down and still wind up at a sale price that’s comfortable for you. If houses in the area tend to sell above asking price, it’s a seller’s market. In that case, you may be able to set a list price that’s a bit higher than the recent sale prices for comparable homes. Just be careful not to choose a price so high that buyers won’t bother to look at your house at all.

Gather Information and Rely on Expert Advice
When setting a list price for your home, you need to be realistic and base your decision on hard data and local market conditions. Your real estate agent can gather detailed information that can help you settle on a reasonable asking price so you can sell your home quickly and make as much profit as possible.

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