Pricing your home correctly just may be the most critical factor in the whole home-sale process. Pricing for a timely sale is key because, as numerous studies have shown, the longer a home sits on the market, the less money it will ultimately fetch when it finally does sell. You certainly don’t want to price too high, but you don’t want to price too low either because that too can hurt your chances of a sale. Take a look, then, at these 5 things to consider when pricing your home in Los Angeles.
1. All Aspects of the CMA
The comparative market analysis (CMA) that you or your agent performs should form the basis of your decisions for pricing your home in Los Angeles. A CMA reveals the prices of recently sold homes comparable to yours and similar for-sale homes in the same neighborhood and immediate area. Homes that are currently on the market (active homes) are your competition, so you need to know how they and their prices compare to yours.
In pricing your home in Los Angeles, then, you need to pay attention to all aspects and evaluation criteria of the CMA:
- Area and location
- The area’s market history
- Size (square footage and number of rooms)
Be sure to ask your agent to explain why each home was included in the CMA and whether and why she eliminated any homes from the CMA. This is all critical information for pricing your home. (To find out more, call 562-881-9811.)
2. Differences Between Homes
After the CMA has been run, another key factor for correctly pricing your home in Los Angeles is realizing that no two homes are exactly alike. A home may be similar to or comparable to yours, but there will still be differences.
Your home and a comparable home may have the same square footage and the same number of bedrooms and bathrooms, so they should be priced about the same, right? Not necessarily. The floor plans may be entirely different and the kitchen in one may be in an awkward location. Most buyers prefer floor plans with better flow, so the home with that layout will likely be worth more.
3. Local Market Nuances
Local markets are small micro-niches and there can be nuanced differences and even significant differences between them that affect pricing. You may consider a comparable home just down the block from yours in the same location and worth about the same. But it could, in fact, be in a different school zone or in a different tax district, either or both of which will affect value and pricing. So don’t neglect to take into account local market nuances when pricing your home in Los Angeles.
This is one factor where the expertise of a local real estate agent can be invaluable. Your agent will be up on all the differences in local markets and can help you price accordingly. (Call 562-881-9811 to discover how a good local agent can help.)
4. When Properties Sold
Another factor to consider in pricing your home in Los Angeles is when comparable homes sold. Local markets aren’t static, and conditions are always changing. This means that a comparable home’s selling price will assist you in pricing your home only if the current market is similar to the market when that home sold.
If, for example, the market when that comparable home sold was less competitive than the market now, you may not be able to price as high. Or, on the other hand, if the market was more competitive then, you may be able to price higher. You simply must compare market conditions in order to price for a quick sale.
5. Agent as Resource
It should be fairly obvious, then, that pricing your home in Los Angeles involves more than looking at a handful of similar homes and the prices they sold at. And much of it is too big a burden to try to understand without extensive market and pricing experience. So, as a general rule, the sooner you begin to use your local real estate agent as a pricing resource, the better off you’ll be.