How Much Can I Sell My House For? Home Pricing 101

As a homeowner selling your home, you certainly want to get the most money you possibly can. Closing with a great price is every seller’s goal, but how much you can sell your house for depends on a variety of factors. Working with an experienced real estate agent is one way to ensure you get top dollar for your home.

Let’s walk through some key considerations to carefully weigh when pricing your home.

Listing Vs. Selling Price

Your listing price, also known as the asking price, is the price you put your house on the market for. The selling price is what you and the buyer agree the house will sell for. The difference between what you list your house at and what it sells for can vary significantly.

If you list your house in a buyer’s market, it’s likely a buyer will bid below the listing price. The longer your home is on the market, the more likely a buyer will bid low.

On the other hand, if the market is competitive, buyers might bid over the listing price. This can result in a bidding war, with the house selling well over the listing price.

Bidding Wars

Bidding wars occur in highly competitive markets. They’re when multiple bids come in on a desirable house, and the buyers are trying to outdo each other with better bids.

You can use several strategies to encourage bidding wars for your home. One wise way to go about making your home more appealing is by cleaning and staging it for viewings. Hiring an experienced real estate agent will also help you encourage a bidding war. They’ll know how to price your house competitively to get an influx of bids.

If you’re successful in starting a bidding war by listing a great house in a competitive market, the selling price of your home could be higher than the price you listed it at. You could also receive more attractive bids, like cash bids or bids without contingencies.

Price Cuts

If the market is slow or your listing isn’t bringing in bids, you’ll want to consider cutting your price. Working with an experienced real estate agent will help you know when it’s a good time to lower your price.

It takes longer to sell a home in some markets. Research the average time on market for similar homes. If your listing isn’t getting any bites after a significant amount of time, you may need to lower your listing price.

With a reduced listing price and a long time on market, buyers may bid even lower. This could make your selling price much lower than what you originally listed the home for. That’s why it’s so important to start with the best possible listing price.

How To Price A Home For Sale

Several factors can come into play when determining your listing price. Working with an experienced real estate agent can help you balance these factors and get the most money for your home.

You’ll want to take the steps discussed in the sections below.

Look At Market Conditions

Before listing your home for sale, you’ll need to look at your local market conditions. Think about these variables when pricing your home to list:

• Seasonality: The housing market tends to ebb and flow with the time of the year. Traditionally, spring and summer are the busiest times for sales, with business slowing in the fall and into winter. If you can control when you sell, listing while the market is hot may get you more money.
• Neighborhood competition: Look around at other houses for sale in the neighborhood. How does your home stack up? Are there any improvements you can make or small projects you can do to make your home stand out?
• Buyer’s versus seller’s versus neutral market: The housing market goes through periods that play to sellers’ advantage. At other times, buyers are in a more favorable position. A buyer’s market is one where there are plenty of homes to choose from and you may be able to purchase many homes at below the original listing price. A seller’s market is the inverse of a buyer’s market, in that demand for homes is high and supply isn’t meeting the demand. The overall housing market, as well as your local housing market, could represent a buyer’s market or a seller’s market. Or it could be somewhere in the middle.

Check The Estimated Market Value

You’ll first want to check the estimated market value of your home with a customized property report.

Enter your home address and we’ll give you an estimate of how much it’s worth, how quickly it will sell and the market conditions in your area. We’ll also show you what comparable houses in your area sold for.

Get A Comparative Market Analysis

A comparative market analysis is essential to pricing your home correctly. Your real estate agent should prepare your comparative market analysis by looking at similar homes recently sold near you. They’ll weigh several aspects of these homes against your home. These aspects include:

• Square footage
• Location
• Condition
• Upgrades

If you want to steer away from ultra-low offers, consider using price banding. Price banding sets a floor on the bids you’ll consider. This should deter non-serious offers on your home.

Use Round Numbers

In using a round number for your listing price, the idea is that buyers are more attracted to a number like $150,000 than $148,256. Rounding up with an easy-to-read number could help you pull in more bids. The psychology of this is that people prefer round numbers, even if they’re slightly higher. 

Consider Online Price Ranges

When pricing your home, look at the price brackets in online searches. Most people have a price range that works for their budget. For instance, if a buyer is searching for homes in the $180,000 to $200,000 range, pricing your home at $201,000 will exclude the home from the search results.

Calculate Your Margins

When pricing your home, it’s important to take seller costs into account. Here’s a short list of what you should think about when pricing:

• Real estate agent fees: Typically, sellers pay the commission of both the buyer’s agent and seller’s agent at closing.
• Staging and prep: How much is it going to cost to dress up your home to impress potential buyers? This cost could include updated decorative touches like curtains, paying someone to clean your home, and fresh flowers throughout the home.
• Seller concessions and repairs: Depending on the bid negotiations, you may be asked to cover some closing costs (seller concessions) or have to pay for repairs or improvements to the home at the buyer’s request.
• Transition costs: It can cost a lot to move, especially if you’re moving a long distance. Factor in the cost of movers, boxes, renting a trailer and whether you’ll have to pay for storage.
• Closing costs: Along with paying the agents’ commission, you’ll need to pay other fees. These can include title insurance fees, escrow fees, attorney fees and more.
• Mortgage payoff: When you sell, you must pay off your existing mortgage amount. This is usually a fairly straightforward part of the process since the proceeds from the sale will typically cover the remaining loan balance and then some. However, if you’re selling for less than what you still owe, you’ll have to dig into your savings to pay off the difference in the principal balance.

Home Listing Price FAQs

Check out the answers to some frequently asked questions if you’re wondering how much you should sell your home for right now.

How do I find the selling price of a house?

The best way to arrive at a great listing price for your home is to work with your real estate agent. They can help you navigate the multiple listing service (MLS) to determine market factors and see how similar homes are selling. You’ll want to settle on a price that’s competitive and encourages buyers to make an offer.

What is the formula for pricing a house?

There’s no set formula for pricing a house, but there are some common ways to appraise your house and make sure the asking price is neither too high nor too low. The condition of the home, its location, real estate “comps” (the recent home sale price of similar houses nearby), and square footage all go into determining how much a buyer may be willing to pay. Other factors can also affect the value of a property, so it’s best to discuss them with a real estate agent, who might also be a REALTOR^®.

How do appraisers determine the price per square foot?

Appraisers determine price per square foot by dividing the appraised home value by its square footage. Similarly, if your home’s sale price is $300,000 and the house is 2,000 square feet, you divide the sale price by square footage. In this example, the home’s price per square foot is $150. Take this into consideration when pricing your property but remember that home buyers are also likely considering other factors, such as where the house is located or whether it will need major repairs.

The Bottom Line: Refining Your Home Price Can Pay Dividends

A lot of factors go into determining how much to sell your home for. This process is made much easier with an experienced real estate agent. Since they work on agent commission, they’re incentivized to make sure you get the best selling price possible.

Take the guesswork out of pricing your home. Find an agent who can give an expert opinion and figure out the best listing price.