How to Price your Home

Many times when I go on a listing appointment, sellers don’t seem to have a real understanding of how a property is priced. Much of the time they compare their home to one that sold in the neighborhood but they don’t have the understanding on how to really use that sold property as a comparable to their own home.

I typically hear things like.. “well Mr and Mrs. Johnson’s house sold for $200,000, so my house should be at least $250,000”. But when we sit down and go over the Johnson’s house and what they have versus what you have, make the adjustments and see what the value range is… it’s at that moment that the “aha” comes.

Getting back to “comping”. It is definitely a knack to be able to pull the right comps, make adjustments and come up with a value range. When you look at a comparable, you want to adjust for things that add value to a property. Such as garages, square footage, decks, pools, views, condition, etc, etc.

If you are selling your home, as a For Sale By Owner (FSBO) or considering putting it on the market with a professional, it is important to understand how the adjustments are made. Don’t assume that because another home in the neighborhood sold for X that you will get that much or more.

Ok, this is the point where I do a little selling. This is why you need a licensed professional. Your real estate professional will be able to pull the correct comparables and make the adjustments to give you a good value range that your sale price should be within. Sales pitch over!

When you look at the comparable, you will adjust negatively for things the comp has but your property doesn’t. When you look at your home, you will add to the comps value for things you have and they don’t. Once you make the adjustments, tally up (sold price minus/plus adjustments). You need a good three comps, four is better to really have a nice value range.

For properties that are harder to comp because they are somewhat unique, I do recommend enlisting the help of a professional. They will need to most likely go outside the neighborhood and look for similarly valued neighborhoods to find comparables.

The values you will adjust by differ greatly by area and state. Best to check locally with the values of adjustments for your area. To give you an example, here in my local area, there are some areas we might adjust for a garage for $10,000. In other areas, it might be as much as $15,000 or $20,000.

While some of this is based in part on facts such as sold properties, the other part to valuing is an opinion as well. Property condition can be subjective and may vary by area and person.

Happy Valuing!

**Lisa G Lopez is not a licensed appraiser and the above should not be considered as appraising advice but as valuing a property for marketing purposes. If you need the services of an appraiser, please contact a licensed appraiser.

Lisa G Lopez

Lisa G Lopez, Broker/Owner of Home Alliance Realty in Manahawkin NJ, is a 25 year veteran of the real estate industry. Born and raised in the LBI Region, Lisa has witnessed the tremendous change and growth that’s transformed the area into one of the Jersey Shore’s most sought-after destinations. Lisa understands the numerous intangible benefits of living on the Jersey Shore with its unmatched natural beauty and quality of life. Lisa has an MBA with a concentration in marketing from Stockton University and also holds a Broker's and real estate instructor's license. A self-proclaimed “Technophile”, Lisa embraces the newest and brightest in technologies and keeps pace with the latest real estate trends. Lisa’s passion for real estate is evident by the numerous awards and certifications she’s received over the past 25 years. In 2018, she received the prestigious Certified Real Estate Brokerage Manager (CRB) designation, the premier brokerage management credential in the industry. Since 2002 Lisa has achieved The Circle of Excellence Sales Award and in 2016-2018 was awarded The Circle of Excellence Sales Award Platinum level for sales in excess of $20 Million. Lisa’s exceptional knowledge of real estate coupled with her intimate knowledge of the market is what makes her the unequivocal go-to resource for all your real estate needs.