It’s no secret that the real estate market is changing. And if you’re a seller, it’s important to stay up-to-date on the latest trends so you can make the most money from your property. One of the most talked about trends in real estate right now is asking price. Many sellers have found themselves asking, “How do I calculate an attractive asking price for my home in today’s market?”
In order to make sure you’re getting the most out of your asking price, here’s what you need to know.
What is an Asking Price?
An asking price (or list price) is the starting point for negotiation between a buyer and seller. It’s important to note that an asking price is not necessarily the same as the sale price – in many cases, the two are quite different! The asking price is simply what the seller believes can be an attractive price to get the type of offer he is looking for.
When setting your asking price, it is important to keep the market in mind. In order to get the most money for your home, you’ll want to price it at a point that is attractive to the majority of buyers. This may mean setting a lower asking price than what you’re hoping to get for the property, but it’s important to remember that the asking price is not set in stone. Think of it like this- the asking price is part of the marketing- price it to get as many eyes on your property as you can.
Your list price will be determined by a number of factors such as the location of your property, the size of your property, the condition of your property (including curb appeal), the current state of the real estate market, and your competition. If there are similar homes on the market for less, it may be necessary to lower your asking price in order to remain competitive.
In order to accurately determine an asking price for your property, you will need to take all of these factors into account. Keep in mind that asking prices can vary greatly from one area to another, so it’s important to do your research before settling on a number.
Asking Price in Today’s Market
In today’s market, asking prices are rising. List prices have increased by an average of six percent since last year, and they’re expected to continue to rise in the next few years. This means that if you’re selling your home, you can expect to get more money for it than you would have a few years ago.
However, asking prices are not the only factor in today’s market. The other major factor is the inventory of homes for sale. Inventory levels are at an all-time low, and they’re expected to stay low through 2022. This is due to the fact that there are more buyers than there are homes available for sale. Another factor is the mortgage rates, as these rates increase buyers are having more options and sellers are seeing more time on the market.
As a result of these two factors – asking prices and inventory levels – we’re seeing a slight shift in the market. This means that if you’re selling your home and looking at the sold properties from earlier this year to come up with your ask price you could be missing the market.
We are still seeing the perfect homes, the cream puffs going above ask, but if your home is in tip top shape and in the perfect location you may find yourself asking, “Why are we still on the market?” Sometimes terms are just as important as the sale price, timing is generally the second most important term, so pricing and condition have a huge effect on the outcome of the sale.
Determining Your Asking Price
If you’re unsure about how to set an asking price for your home, there are a few things you can do to get an idea of what your property is worth. The first step is to talk to a real estate agent who is familiar with your area. They will be able to give you a good idea of how much similar homes in the area have sold for and help you determine a fair asking price and be able to help you set an asking price that will attract buyers.
Over the past two years, a great way to determine your asking price was to look at recent home sales in your area. However, as the market is currently in an active shift, basing your list price on how homes have sold around you in the past is one of the biggest mistakes I’ve been seeing sellers make. In a quickly changing market the most important stat is the absorption rate, this shows you real time how many buyers are in the market and how fast homes are selling. Sold data shows you what was going on a few months ago and real estate is hyper local and hyper fast.
Once you have an idea of what your home is worth, it’s time to start negotiating with buyers. If you receive an offer that is below your asking price, don’t be afraid to counter-offer! Remember, the asking price is simply a starting point for negotiation and in many cases, the final sale price will be different than the asking price.
The Bottom Line
When it comes to asking price, there’s no one-size-fits-all answer. The most important things to do when going to sell your home are to do your research and make sure you’re pricing your home competitively as well as remember that you are in control. While it’s still important to be reasonable about your asking price, by doing your research and understanding the market, you can ensure that you get the most money for your property. With the help of a real estate agent, you can be sure that you’re asking the right price and getting the best possible deal on your home.
