Maximize Your Selling Price… Minimize Your Expense

There are two parts to how to get the highest possible price for your home while minimizing the cost of getting your home ready for the market… that is, putting the most money in your pocket. The first is correct pricing; the second is spending money only on those things that will add more value than they cost.

Setting Your Asking Price

There are two approaches with regard to setting your asking price. The first is to list above the estimated value of your home and lower the price progressively until it sells. Sellers who choose this strategy are usually in less of a hurry and more risk averse. The second approach is to list below the estimated value. These sellers are usually trying to sell faster and hope to bring multiple offers, boosting the final selling price. Contrary to what you might think, the ‘low price’ approach is actually the best way to get the most money for your home, especially in a strong market such as we have today. Here’s how to do it:

Get a Good Estimate of What Your Home is Worth

Your agent should prepare a comparative market analysis of recently sold homes. Based on these sales, you can get a good idea of the value of your home in the eyes of the buyer — remember, buyers will see exactly the same comparable sales. If you are planning to under-price your home, it’s critical that buyers will recognize that your price is very attractive.

Set Your Asking Price in a “Sweet Spot”

The asking price must be low enough to get buyers excited, but not so low that the chances of getting an offer at or above your estimated value are very low. You don’t want your asking price to be in  ‘no man’s land’, lower than what you want but not low enough to ignite a bidding war; but neither to you want the price to be so low that the leap to what you want is just too far. There is an art in setting the right asking price, in finding the ‘sweet spot’ — make sure you choose a realtor who knows how to do this!

Maximum Exposure in a Compressed Time Frame

The goal is to get as many potential buyers into your home as possible during a short period of time. It has been found that the optimum time period is about one week — long enough for everyone interested in the home to see it, but short enough that interest and excitement about the home won’t fade and be diluted as other homes come on the market. Make sure it’s as easy as possible for buyers to get in to see your home on short notice. Weekend open houses can help — buyers can come back for a second look, bring their parents, etc. It’s all about exposure.

Delay Offer Presentations

Set a target date after the open houses that is convenient for buyers — say Tuesday or Wednesday evening — and invite all interested buyers to present offers at that time. If you have set your price well, and if the house has been properly exposed, there is a good chance that you will receive multiple offers and a very satisfactory selling price!

Home Improvements Before Listing

There are many home improvements that might enhance your home’s value, such as putting in an expensive new kitchen or bath, but stick to the lowest cost for the highest possible value. Your goal is to make a positive first impression and sell your home quickly.

Fix Whatever is Broken

Whether it’s a leaky faucet, a window that won’t open, or a door that won’t shut, get these small repairs done. Small problems like these create a ‘halo effect’ in buyers’ minds that leads to an overall impression that the home has not been well cared for.

Pay Attention to the Entry

First impressions are critical, so take a close look at the first things that buyers will see as they enter your home. Buyers will often decide within the first few minutes (or seconds!) whether they like your home, so make sure what they see first is up to snuff.

Paint, Paint, Paint

A coat of paint can cover scuff marks and dirt and brighten a room. Did you love flamingo pink for your hallway and forest green in your kitchen? That’s great! But chances are buyers won’t have your tastes so instead opt for neutral colors such as grays and earth tones when readying your home to sell. Painting is probably the single best thing you can do to increase value at low cost.

Replace Tired Flooring

If your carpet is more than five years old, has unsightly stains or is starting to buckle, it’s time to replace it. You can replace carpet with carpet but today’s buyers see more value in hard floors. There are many options, including hardwood and a wide range of laminated or engineered flooring, some of which are more expensive (and better) than hardwood. One continuous floor of the same material also creates the appearance that the home is bigger, creating an impression your home is worth more.

Revitalize Your Kitchen and Bathrooms

Fully renovated kitchens and bathrooms are a great investment, but don’t spend the money if you are looking to sell. Instead, revitalize them by refinishing cabinets, replacing hardware, upgrading appliances or installing an attractive new vanity. Changes like these will improve the appeal far out of proportion to the cost.