Step 2: Determine Your Home's Value

Setting a listing price is one of the most important parts of the home selling process. Knowing your home’s value helps you determine its price.

What determines home value

Many factors go into determining home value. The square footage and number of bedrooms and bathrooms plays a large part. Typically, larger homes with more bedrooms and bathrooms increase the home value. There are several other features that help determine home value. Does your home have a magnificent view? Is it on a private lot or cul de sac, or close to public transportation? All of these can add to its value. School districts can greatly affect value, and the age and condition of the home are also factors.

Another factor in home value is the current number of comparable listings on the market. The fewer the listings, the more valuable your home, particularly if it’s in a desirable location or has amenities hard to find in your area. Supply and demand can make your home worth more, allowing you to set a higher price when you sell. Conversely, if there are many homes similar to yours on the market, that can lower the value, especially if there aren’t many buyers.

How to find your home value and set your price

There are many tools available to help you determine your home value. The most obvious is your real estate agent. Your agent should have a good understanding of the current market in your area, allowing them to review comparable homes and estimate how your home sizes up. If you want to get an idea of your home’s value before talking with an agent, you can use the Home Price CheckSM tool from RealEstate.com to get a value for your home, based on prices for comparable homes in your area. It might be a good idea to use this for comparison with the price that your agent recommends.

When comparing your home to similar ones, make sure you look at more than square footage and the number of rooms. Take into account features such as molding, the condition of the home, the slope of the lot, etc. when looking at comps.

One final factor in determining your price is your time. If you are not in a hurry to sell, you can price your house higher because you have the luxury to wait for the right buyer. Just make sure you don’t price it too high – you don’t want to scare away prospective buyers. However, if you are in a time crunch, it may be better to price your home on the low end in order to sell quickly. Selling quickly may be more valuable than whatever additional money you would get from a starting at a higher price.