How EXACTLY should I price my home? and why an algorithm can't do it for you

For obvious reasons, pricing is typically a top concern for home sellers. Get it right and you could have multiple offers that will produce favorable terms that make your sale both easy and profitable. Get it wrong and you miss the peak of your home’s marketability, rack up days on market, and invite lowball offers with risky or inconvenient terms and contingencies. Pricing is a science, until lack of data and context makes it an art. 

The Science

The larger trends are easy. Most algorithms can tell you how general sales are performing metro-wide, county-wide, or in your zip code. If your home is a carbon copy of every other house on the block, targeting a price is much more straightforward.

However, for most homeowners in the Twin Cities, "cookie-cutter" isn't the reality. Our neighborhoods are defined by character, varying eras of construction, and obviously every home has varying conditions and updates. The kitchen you remodeled a couple years ago is going to hit differently with buyers than your neighbor's that hasn't had a facelift in decades. Same thing for your newer roof and windows. This is where the algorithm falls short and just does not have the context needed to target a price. 

The Art

Here is where an in-person Competitive Market Analysis (CMA) comes in. To price accurately, you need to look at what prices homes of similar size and amenities within a tight geographic area of your home have sold for in the past 180 days. Of those homes, we then need to further evaluate in comparison to your property; What major mechanical or cosmetic updates make your home similar or different? What steps will you plan to take to make your home compelling to buyers with prep like fresh paint or staging compared to what comparable properties did? What specific location considerations like proximity to a busy street or railway might impact desirability? Is the home next door pristine or a junk yard? These are factors that a virtual estimator can’t account for. 

Once a value range is established based on these evaluations, the question becomes what strategy in that range will be effective to reach your goals in the current market? 

An algorithm or estimator will give you a number, but it’s not necessarily accurate, and it certainly isn’t informed by a strategy.

If you want to know what your home is actually worth in today's Twin Cities market let’s walk through it together. Get started with my 5-minute seller questionnaire.