| As the 2008 financial crisis continues to unfold in the | | | | If you decide to work with a real estate agent during |
| U.S., many home sellers have found themselves in a | | | | your selling process, this will all be easier for you. This |
| bind. Prices have dropped, banks are failing, and home | | | | is one of the things an agent will handle for you. |
| buyers are having an increasingly hard time getting | | | | They refer to it as the comparative market analysis, |
| mortgage loans. | | | | or CMA. If you would rather handle the pricing |
| So how does one go about selling a house in the | | | | yourself, you can do that too. Agents get their data |
| current economy? For starters, you need to price | | | | from public information, not from some private |
| your home properly. The pricing process intimidates a | | | | source. They look at the same thing you could look |
| lot of sellers, especially those who are handling the | | | | at -- recent sales data on similar homes in your area. |
| process by themselves (without an agent). But it | | | | 3. Consider Supply and Demand |
| doesn't have to be scary or confusing. Here are | | | | This is always an important consideration for sellers, |
| some tips to help you get it right. | | | | but right now it plays a major role. Due to recent |
| 1. Detach Your Emotions | | | | economic events, the supply and demand of real |
| When you live in a home for a certain length of time, | | | | estate is skewed like never before. The subprime |
| you develop an emotional attachment to it. This is | | | | mortgage crisis has led to record numbers of home |
| perfectly natural. After all, it's your "safe haven" from | | | | foreclosure, which drives up the supply of houses. |
| the world. It's where you go for privacy, security and | | | | But it has also become much harder for buyers to |
| relaxation. It might even be the place where you | | | | qualify for mortgage loans, which decreases the |
| witnessed your child's first steps, or their first day at | | | | demand. When supply goes up and demand goes |
| school. | | | | down, it becomes a buyer's market. This is what's |
| But the thing to keep in mind when selling your house | | | | happening in most cities across the country right now. |
| is that emotional value does not carry over into | | | | Of course, there are some anomalies in certain cities |
| financial value. In other words, you can't price a home | | | | across the U.S. For example, I live in Austin, Texas, |
| based on the memories it holds or the good times it | | | | and the market here has not suffered as badly as |
| has given you. You cannot set the selling price based | | | | other cities. The reasons are twofold -- (1) our |
| on what the place is worth to you. Instead, you | | | | housing prices were not artificially inflated before this |
| must base your numbers on what the house is worth | | | | crisis, and (2) there is a high rate of immigration as |
| in the current market, based on the concept of | | | | people relocate here from elsewhere in the country. |
| comparable sales that we will discuss below. | | | | To figure out the supply and demand situation in your |
| You might think this is something of a no-brainer or | | | | area, you'll have to do some homework. Your local |
| an obvious point. Yet, you would be surprise by how | | | | newspaper is a good place to start. |
| many sellers let their emotions get in the way of real | | | | Conclusion and Going Forward |
| estate reality. | | | | It may be harder to sell a home in today's market, |
| 2. Research Comparable Sales in Your Area | | | | but it is by no means impossible. The key is to go |
| The pricing process will be much easier for you when | | | | into the process with proper research and |
| you research comparable sales in your area, as well | | | | expectations. If you do your homework and price |
| as homes that are currently listed for sale. The real | | | | your home based on real market conditions -- and if |
| estate terminology for this is "comps," short for | | | | you do a good job preparing and marketing the |
| comparable sales. Here, we are talking about homes | | | | property -- there is no reason you can't sell in a |
| that are similar to yours that have been sold in your | | | | reasonable amount of time. On the other hand, if you |
| area recently. By using this information, you can | | | | have conjured your asking price out of thin air, you |
| determine your own price -- and it will be based on | | | | will be in for a rude awakening. |
| real data, not on emotions. | | | | |