Market Matters: How do I (or my agent) figure out the list price of my home?

Illustration by Muti

It can be both a science and an art form,” says Matt Gerding, a local real estate consultant with RE/MAX Elite. If you’re listing through an agent, their first step will be putting together a comparative market analysis (CMA) using recent sales nearby. “Typically we’ll go back six months and see what similar homes have sold for,” he says. That’s the science part. “The art form is trying to understand the neighborhood and to look at your particular home,” he says. “Does it have unique features that would add a higher return?” A smart price takes into account the popularity of the community, the available inventory, and judges your house against its peers. You generally want to give yourself some negotiating room, but you also shouldn’t be foolish or greedy. “It has been statistically shown that if you price your home too high, you’ll actually make less money than if you had priced correctly,” cautions Gerding. That’s why examining the market—and trusting your agent—is important. “It has nothing to do with what you bought it for x number of years ago or the x number of dollars you put in,” he adds. “The market is going to dictate what that home is worth.”

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