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| Determining
Your Selling Price |
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If you are selling your home by private treaty, the most important decision you will need to make is what price to put it to the market.
Setting a realistic price will ensure you obtain your asking price (or close to it) and also conduct the sale promptly. When determining a sound price you should:
An appraisal is
performed when a Real Estate Agent inspects your property and estimates
it's value. Many Real Estate Agents will conduct free appraisals in the
hope that you will choose them as your agent.
| You
may be tempted to select the Real Estate Agent that
recommends the highest price for your property. However,
be wary of agents who put high prices on properties
simply to gain your business; advertising your
house at a price way over the market value of the
property can be detrimental to it's sale in the long
term. |
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Prior to appraisal,
the majority of sellers will have a price expectation that is possible 5% to 10%
above the realistic market level. Bear this in mind when assessing whether
an agent is over-pricing your property.
Determining what
other people have been willing to pay over recent months for properties similar
to yours (i.e. similar condition, style and locality) is another
important factor to consider when setting your price.
Your Real Estate
Agent should have access to this information. Often referred to as a
Comparative Market Analysis, it will also include data on nearby
properties that have failed to sell, together with their listing prices. Ask your Real Estate Agent to review the analysis to support the
price he recommends for your property.
A Comparative Market
Analysis will often include data on the number of days each comparable
property was on the market prior to being sold.
When the property
market is booming and property prices are on the increase, properties
can sell in only a few days. Alternatively, if the market is slow, the
average time for properties to be on the market can be several months.
The prevailing exchange rate can also have a dramatic effect on the
quickness of a sale. When the Asian economic crisis hit and the Thai
Baht drifted out to 55 to the US Dollar, properties in Thailand were
snapped up at an amazing rate, being such good value in foreign currency
terms.
Your Real Estate
Agent will be able to tell you the strength of the market in your area,
and whether it is experiencing a Buyer's Market (i.e. slow period) or a
Seller's Market (i.e. boom).
| In
a buyer's market you may need to price conservatively in
order to sell, while in a seller's market you are more
likely to get a price which exceeds expectations and you
can therefore set your price accordingly. |
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When you are
satisfied that you can reasonably estimate the market value of your
property, you can then assess the net proceeds you are likely to receive if
you sell.
To do this, you will
need to determine the fees and costs associated with the sale of your
property. These expenses should then be subtracted from your estimated
sales price. Some of the costs and expenses to be considered are:
- The Real Estate
Agent's commission,
- Any
Marketing/Advertising fees,
- Lawyers fees
and settlement costs,
- Any improvement
and repair costs.
Now
it's time to
prepare the house for
sale.
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