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Establishing the “right price” price-point or listing price for a property is actually not difficult. Many of the “algorithm generated” figures that abound don’t consider lots of very important criteria. A knowledgeable local agent or broker is the best way to get a granular view when establishing any listing price. The subject is never adjusted, only the SOLD comps to make them more similar to the subject and suggest the subject best price-point or certainly a value range. Adjustments are necessary to account for competitive differences of the sold properties when compared to the subject. Factors like square footage, lot size, year built, room counts, especially bedrooms and bathrooms are the most common adjustments. Beyond that….garage, known upgrades and obvious condition details of sold properties are big factors. Lot situation: like a steep grade or driveway, corner lot, busy streets are not easy adjustments to apply, but must be considered. Amenities like pools, substantial outbuildings etc., are factors to be considered. Active properties that compare closely are your “right now competition” with buyers that will visit or consider those vs. what your property offers for the price.
There are unique characteristics of every single property that can’t easily be adjusted by typical appraisal standards, but definitely can impact appeal and desirability to people that might consider that property for purchase. Anything that impacts buyer appeal must at least be considered when setting a price-point. Again, that unique personality or characteristic is difficult to adjust +/-, but can also be the end cause of a particular property expiring without a sale, basically rejected by the market based at least partly on that “certain something or situation” it had or didn’t have.
Set a listing price using reliable, current, and adjusted data. Rely on your agent to support and promote that price with “gusto” for any inquiry from a prospect or agent. I have completed over a thousand BPO reports for banks and third party vendors. A BPO is a Broker Price Opinion. These reports vary in complexity, but all require diligent efforts to establish likely price-points for someone that might be a thousand miles away with no personal knowledge of the property. They are depending on your “been to the site” local market opinion. A BPO for Fannie Mae or Wells Fargo can take hours to complete and gets reviewed, maybe even returned for revisions.
Sometimes though, the market is very kind as it has been to many sellers in the past four years! The current market is returning to a balanced situation where neither a seller or buyer might have any particular advantage over the other. Average days on market and inventory levels are increasing in late 2024. There are still many situations where a particular home enjoys a rush of buyer activity based usually on a very limited supply, but high demand for the location or features of that home.
