Understanding Market Value and Pricing Your Dallas Home

By dallasrealtor | November 20, 2008

The goal in selling a Dallas home is to sell it for the highest possible return.  Homeowners have made a significant investment in their home when they purchased it initially and they may have put a lot more money into while they have owned it.  If they are putting your house on the market after owning it for many years, this is of more importance to them than if you they only owned the home for a year.  If they have not owned the home for very long, then they probably understand that the market has not been the most favorable. 

Market sensitive pricing can be the key to maximize market exposure and ultimately, a satisfactory sale.  Establishing the best listing price up front will result in the best selling price.  The existing list of potential buyers determines a property’s value.  This is typically based upon location, design, amenities and condition.  The availability of competing properties is also a factor.

Dynamics that have little or no influence on the market value of a home include the price the seller originally paid for the property.  This is something most homeowners use as a basis for pricing their home.  It is a common misconception.  Other factors include the seller’s expected net proceeds and the amount spent on improvements.

Getting a Competitive Market Analysis would be a great way to determine the value of the property from a real estate standpoint.  Dallas Realtors use this tool to show what buyers in the current market have actually paid for similar properties.  It also shows competitive properties that are currently on the market and properties that have failed to sell.  Understanding why a property failed to sell can help avoid disappointment in the marketing of a property.

An impartial evaluation of market activity is the most effective way to estimate a property’s potential selling price.  A general rule of thumb to keep in mind is that a prudent person will pay no more for a property than it would cost to purchase a comparable substitute.  Buyers look at a property the most when it is first put on the market, so keep the following tips in mind:

• Interest is at its highest when a property is first put on the market. If the asking price is beyond market range it can cause adverse affects.

• Keep in mind that a home needs an appraisal.  If the appraisal falls short of the asking price it will not secure a loan.

• It may become necessary to adjust the price below market value to compete with new, competitively priced homes in the area.

• The longer a property is on the market, the initial marketing momentum is lost.

These are just a few tips on what to expect when putting a house on the market.  Today’s economy is vastly different than what it used to be, so the marketing of a home needs to accommodate this.  Depending upon how anxious a seller is will determine how aggressive the strategy needs to be.  However, keep in mind that the economy is what it is, so plan accordingly.
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