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How Agents Determine a Home's Listing Price

When your real estate agent is getting ready to list your home for sale, several factors are taken into consideration. Many buyers in today’s market are not only working alongside an agent, but are well informed and have already done their homework. Your home may be worth more (or less) than you think depending on the current market, its condition, etc. To understand what goes into analyzing a home’s worth, take a look at the important components below.  

How Agents Determine a Home's Listing Price 

The real estate market demand

Your local market will have a great impact on your home’s listing price. The real estate market in your city, state, and even your neighborhood will go up and down. An agent needs to perform a market absorption of the area. A low inventory in a market with an abundance of motivated buyers, for example, may put your home at a higher demand. This can result in more negotiating power for you and your agent, giving you more leverage when negotiating the home’s final sale price. Neighborhood factors like walkability, access to transportation, and amenities of the community can all affect the demand.

Agents look at comps

A way to determine your home’s list price is by looking at comps (short for “comparables”), which are the final sale prices of similar homes in your neighborhood. Homes that are in your location, are similar style, are similar size (square footage) as your home, and have the same amount of rooms are the type of homes that are used as comps when evaluating your home’s listing price. While sellers use comps as a guide for coming up with a list price, buyers may use them to put an offer on the home. Of course, no two homes are exactly alike. A highly trained Success Manager at DLP Realty will be able to guide you through the differences.

An agent analyzes the square footage of your home (and lot)

Many people think that the price per square foot of your home is what ultimately determines its value. Aside from the other factors mentioned in this article, a combination of the square footage and the livable space of your home are also taken into account. Whether or not your home has an attic or basement likely doesn’t matter as much as the amount of bedrooms and bathrooms. This is why building additional rooms and bathrooms is often a good investment, as it can increase the value of your home. 

Agents look at the condition of your home

Homes that are newer tend to come with fewer problems and generally appeal more to buyers. Homes with major plumbing, electrical, or roofing issues can be a major turn-off for buyers and may appraise lower due to the home’s condition. In fact, most buyers are willing to pay more for a newer home that doesn’t need major upgrades upon or after moving in. Some repairs can cost hundreds, even thousands of dollars, and can be a hassle to deal with. Consult with an expert Success Manager at DLP Realty to get a better handle on the condition of your home and the improvements you may need to make to increase its value.

Would you like to know how much your home is worth? Get in touch with one of our knowledgeable real estate experts today.

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