When you meet with a REALTOR® for what’s known as your “Listing Presentation”, your Real Estate Agent will provide a price that they have determined for your home. This, of course, is not a number pulled out of thin air, but a carefully researched price based on a number of factors. Your agent will have all of the specifics of why they have chosen that particular price point, usually based on a combination of the following aspects:
1. Location, location, location.
Location can mean a number of things: price of recent sales, the quality of schools nearby, even your neighbors. While HOA’s are notoriously criticized for their penchant for details, having a next door neighbor with a pink house and tropical decorations will likely scare away buyers. Even the stores in the vicinity can affect your home’s value. Considering how popular places like Starbucks and Trader Joe’s are, it’s no wonder these particular shops will significantly increase your locale’s popularity.
2. Land, easements and outbuildings.
Living in an area with heaps of hunt country properties like Northern Virginia, you’ll find no shortage of unique situations. Buyers looking in those areas often have their interest peaked by significant acreage and extra outbuildings in good condition, like a separate garage with a second story that can be converted into a home office or rental space. Even easements can work in your favor as a seller if it means part of the surrounding area will remain undeveloped and picturesque for years to come.
3. Age and condition.
Homes deemed “historic” usually carry added value, but on the whole, the newer the home, the higher the selling price. Additionally, the overall condition of your property will greatly affect how it shows. Most people are willing to pay a little more for a move-in ready home vs. a home they will need to put some elbow grease into finishing.
4. Size and layout.
Size is a tricky thing when it comes to marketing a home. It used to be that the larger your property, the larger your price tag. However, there is a new trend in buyers to downsize a bit in order to avoid the added time and money that goes with the upkeep of a large property. Which way your property will fall depends very much on your area and similar sales. Also, your layout will greatly affect your price, as buyers are looking for open concepts and fewer, but larger, bedrooms.
5. Upgrades: Kitchen + Master bath first; what else has been done to similar houses in your area?
Upgrades will of course have a major impact on price consideration. You will need to use caution, though, before hiring a contractor to completely demo your home. While homebuyers will be impressed by new kitchen appliances and beautiful master bathrooms, many renovations stop there. If other homes in your area are found with only a few major adjustments being made, revamping your property may result in you not being able to recoup your losses. If your home is priced $25,000 above your neighbors, you’re likely to have less inquiries – and thus less offers. Small updates, such as new doorknobs and sink finishes, will go a long way without breaking the bank.
REMEMBER: Before starting major renovations, it’s a good idea to talk with your REALTOR® about which projects will get you the most bang for your buck.
We hope this information has helped inform you how your agent will determine your home’s worth! Don’t have an agent to assist you in your home selling process? Let us help!