What is the Right Price Forumula for Real Estate

January 11, 2013

By John Voket, RISMedia Columnist
In our last segment, I examined scientific proof that setting the right price right out of the gate is the best way to sell your home fast. But getting that right price can be a challenge, without one important document – a thorough market analysis.

Recently, broker Bryant Tutas in central Florida was quoted as saying any property will sell if the price is right.

But is the right price “Market Value” based on the last 6 months of sales? Is it based on homes that have sold in the last 30 days? Or is it the “Appraised Value”?

Tutas says the “Right Price” is the price that will sell your listing in 60 to 90 days. In his market the right price is 5 to 10 percent below recent comparable sales.

He says when REALTORS® are searching the MLS they may have 70-100 homes that meet their buyer’s parameters. So in order to sell, his client’s property needs to be in the top 5 (preferably No. 1) of properties on the list (by price) and it needs to have a competitive or better co-broke.

If a seller in his region can achieve this positioning Tutas says there should be no problem getting the listing sold in a short period of time.

Tutas says seller’s need to know that when pricing a house they must look at the whole picture that includes active, pending, withdrawn, expired and recently sold listings. And he’s met with many sellers recently whose listings have expired and they have never even seen a “Market Analysis.”

A 2011 report at Investopedia.com offering tips to sell your home faster, advises performing a good market analysis to help sell a property quickly.

It’s not always imperative to be the lowest priced home on the block, particularly when aesthetic and other significant improvements have been made. However, it is important that the listing price is not out of line with other comparable homes in the market.

Try to put yourself in the buyer’s shoes and then determine what a fair price might be. Investopedia even suggests you have friends, neighbors and real estate professionals t