Buying a Starter Home

Understanding What Factors Influence Your Home's Sale Price

14 March 2016

Capucine Leroux

If you're listing your home for sale for the first time, you may be wondering what goes into that pricing report that your real estate agent gives you. The sale price your agent recommends isn't an arbitrary number. In fact, it's based on a complex series of factors that all contribute to your home's value. Here's a look at what you should know about the things that affect the pricing of your property.

The Location - Your home's location is about far more than just the town or neighborhood that it's in. Your agent is also going to consider its proximity to shopping, local schools and public transportation. For example, if your home is within close proximity to the highest rated school in the district and within walking distance of the town shopping center, it will be worth more than a home that's near the lowest-rated school or no shopping areas.

Condition and Age - The general condition of your home and its age are significant factors in its pricing. After all, if your home is older and showing signs of wear, it's going to be priced lower than brand new construction that's immaculate. Buyers will be more likely to pay higher pricing for a home that has been maintained and is in good condition than they would a home with water damage, foundation issues or wear and tear visible on the floors, carpeting or walls.

Improvements and Features - Any improvements or features that you add to your home can increase the sale price. For example, if you build an addition, upgrade the bathroom or remodel the kitchen, these things will increase the value of the property. In addition, an added patio, walkway or swimming pool can increase the property value, provided that they are in good condition and properly maintained. Elaborate landscaping and a well-groomed yard can also help contribute to the value of the property.

Current Market Conditions - The housing market can be volatile. When there are a significant number of homes for sale on the market in the same range as yours and home buyers are limited, that's often an indication that your home may sell for less than you would have expected otherwise. This is what is known as a buyer's market, because there are many options for buyers to choose from. In contrast, if it is a seller's market, there are very few homes on the market and many people shopping, which means you may be able to get more for your home than it would otherwise be worth.

Your Motivation to Sell - Your current motivation to sell your home will definitely affect how much the home sells for. If you're in a hurry to close the sale because of a significant event or major life change, you are likely to sell the house for less money than if you were in a position where you could be selective about the offer and take your time to sell. If you have time to wait, you can put off selling until you get a higher offer that meets your preferences.

The Sales Marketing - When you enlist the services of a real estate agent to help you sell your house, the marketing efforts that the agent puts into the process will have an effect on how much the home sells for. If the agent is able to capitalize on the features of your home and market it accordingly, you may be able to get a higher offer than if the marketing is mediocre or minimal.

As you can see, there are many different factors that can directly affect what your home sells for. If you're looking to get as much as possible from your property sale, consider these things and adjust what you can to try to improve the offers you receive.

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