Setting a listing price is an art, not science. Homeowners are faced with a staggering amount of information that can make a decision difficult. I started to think of some of the influences that sellers face when trying to set that initial price.
- Zillow – Sellers love to consult Zillow and it’s a rare occurrence these days when sellers have not at least looked at the Zestimate for their home.
- Neighbors – Sellers will often talk with neighbors when trying to validate a potential value for their home.
- Friends & Family – In today’s world we are heavily influenced by the opinions of our friends and family members. We often look to them for reassurance that we are doing the right thing, or working with the right people.
- Social Media – There are limitless words written to support almost any position a seller may have on any aspect of real estate.
- Media – Sellers will read articles in local, regional, and often national media and draw conclusions about the value of their home relative to the opinion of these articles.
- Open Houses – Sellers like to visit open houses to see what price others have set for their homes.
- Upgrades and Investments – Sellers will often factor the costs of re-modeling, pools, landscaping, solar, etc when trying to determine a listing price for their home.
- Appraisals – Sometimes homeowners feel that an appraisal will give them a definitive answer on price when listing their home.
- Gut – Some sellers know the value of their home. They are only interested in finding a buyer that will agree with their perspective.
- Realtors – Often the last to be consulted when people are deciding to list their home. Many times sellers will use the opinions of several Realtors to validate or reject differing opinions that they may have about the value of their home.
To be fair, Realtors are not without their own set of bias and opinion and can often have a fixed position that is hard to sway. We are often so close to the process that we lose site of the fact that we too should make allowances for other opinions outside of our own. I do believe that a professional Realtor that is working in the business can cut through the ‘noise’ and help sellers arrive at a sharp listing price.
Sellers, after doing their own due diligence and consulting a real estate professional, should feel comfortable that they can set a fairly accurate price. When they place their home on the market, they will get the relevant feedback necessary to confirm or disprove their assumptions. If they they do not receive offers within a reasonable period of time, then the market is telling them they will need to adjust their price in order to sell their home.