Real Estate Term of the Day: Asking Price
ASKING PRICE – the list price that an owner would like to receive for their property (Barron’s Dictionary of Real Estate Terms)
Here are a few things to consider when trying to understand how the asking price should be properly arrived at:
- What are similar homes selling for in your neighborhood?
- How many have recently sold, expired or gone under contract?
- How does your home compare to the other active listings (aka: the “competition”)?
- What upgrades/improvements have been made on the home to increase the value?
- Can your asking price be justified reasonably by an appraiser using recent comparable sales in your neighborhood?
- What is the condition of the real estate market in your area? Is a Buyer’s market? Seller’s market? or Balanced market?
- What is the average original sales price to final sales price in your market?
- What is the average amount of concessions given to buyers in your market?
Your asking price should not be:
- The amount of money you need to make to purchase your next home
- The amount you owe on your loan plus closing costs (such as marketing fees)
Although they above two factors might influence your decision to sell, these costs should not be a factor in your asking price if you have to sell.
If you would like to understand what a proper asking price would be for your home, contact me for a Free Home Evaluation