Factors that affect the price of a home
Location: There's no excaping it. If your house is located in a desirable area, you will be able to get a higher price than you can for the same house in a less desirable area. The one thing to remember about location, however, is not to make general assumptions- like, "my house is worth as much as another house because we are in the same town or subdivision." Location doesn't just mean school district, subdivision, or town. Location also means proximity to a road, river, lake, or power line. For example, in a subdivision, the homes at the front of the subdivision near the entrance generally have a lower value- especially if the road they enter on is a highway or busy street. Why? Because the increased noise, traffic and potential safety issues for families with children will turn off some of the potential buyers.
Condition: A house that has been better maintained and shows better will always sell for more than one that has had neglected or needs work. It's surprising how a few thousand dollars in upgrades can net tens of thousands of dollars in returns. Discuss with your real estate agent before putting your home on the market, the upgrades you might want to spend some money on prior to listing your home. If $3,000 in kitchen cabinet refacing will net you an extra $10,000 -AND- sell your home quicker, wouldn't you want to do it?
Desirable Features: If a house has features that are currently popular in the local market, it will bring a higher price. An example would be a lake front home at the Lake of the Ozarks or Lake St. Louis.
Marketing: When setting the price, consider how much marketing you or your agent will be doing. Will there be open houses? Will there be advertisements in the paper or on TV? These are all things to take into consideration. Obviously, the more people who see your home, the greater the chance of you selling it. For example, a "For Sale By Owner" sign placed in the front yard generally won't yield anywhere near the buyer traffic as an Agent listing it in the Multiple Listings Service (MLS) Computer System. As a result, if you plan to sell your home on your own, you might want to price it on the lower side of it's value.
Setting the price...
So now you're ready to think about pricing. One way to get an accurate estimated value of your home's worth is by using a professional real estate appraiser. An appraisal will take into account location, condition and sale prices of comparable properties in the neighborhood. The downside to using an appraiser, is it cost money to do so (generally $200-350).
The next best way to determine value is to create a Comparable Market Analysis (CMA). This is a comparison of similar properties in the same general area that compares actual sale prices. If you would like a CMA, you can do it on your own by researching the sale price of homes in your area or you can get a FREE CMA by filling out the form below. Your CMA will be e-mailed to you within one week. There is no cost to this service. Your contact information will be kept private.
