Setting the right selling price on a home is one of the most critical steps in the selling process. Setting the price too high will mean that you don’t generate a lot of interest. Setting it too low will mean that you don’t get as much money as you could have; it may also mean lower interest because you missed a key PEI demographic.
Market value is based on the market. Quite simply, people don’t care about how modern your bathroom is or the paradise that is your backyard. If your house is priced well above similar houses in your neighbourhood on Prince Edward Island, you won’t be able to sell. In order to find a price that is fair and that will generate interest, you will have to look at what similar homes in your neighbourhood are selling for.
Don‘t compare apples to oranges. “Similar houses” is kind of generic, so let’s try to define what it means. Houses that are similar are typically the same in age, number of rooms, and lot sizes. The layout of the kitchen, the layout of the rooms, the way the yard has been done may all be different, but those three factors are always constant. Don’t compare the price of a three bedroom house with that of a four bedroom house; that one room will make a difference of thousands of dollars.
Why don’t improvements matter that much? You may think that the fact that you have added a workshop or a swimming pool adds to what you can ask for your house, but this is not the case. When you are setting a sale price, you are trying to set a price for as wide a range of people as possible. Adding dollars on for improvements that you think are well worth it immediately narrows down interest in that price to people who think like you do. In the PEI real estate market, the house with the most interest will fetch the highest price. It’s important, therefore, to base the price on features that are commonly sought after by everyone.
There are lots of tools available that can help determine what price you should ask for when selling your home. Searching Internet databases for recent sales of homes in your neighbourhood as well as listed property values for the Prince Edward Island area can be a good starting point for determining a sale price. The time of year will probably be a factor in the price of your home as well; the only reason to sell in fall or winter is that you need to get out quickly. Otherwise, wait until spring or summer when the PEI market is typically hot and prices slightly higher.
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