The price your Glendale CA home will fetch on the open market is extremely difficult to pin down. Zillow will tell you it is all predictable based on tracking the price and sales trends, but Zillow is a computer program. It has never sold a home.
The price of your one, unique, home is a combination of your goals, and the perception of value by your ideal buyer at the moment they see your home. That perception of value is influenced by at least three factors- recent sales, the other homes on the market, and the urgency of the buyer population.
The most common way to set price is to compare the size, location and amenities of your home to the most recent sales. Of course, in Glendale, La Crescenta and La Canada no two homes are alike- so a fair amount of educated guessing is involved.
In general we can say a remodeled home will sell for more than than an original home, a home with a large, flat, useable backyard will outsell a normal yard and a home with a fourth bedroom or a separate family room trumps a more common 3 bedroom home.
A simple comparison looks like the best way to predict the price of your home. But this is a value based on the past. It says nothing about where we are today. Even a home that closed escrow today entered escrow a month or more in the past. Market conditions can change drastically in one month.
Competition on the Market
So let’s talk about today. A motivated buyer is looking at all the homes on the market and comparing them to yours. Which is the best value? Which is the best dollar per square foot? Which represents the least inconvenience? Who has the best location?
By comparing your home to the current homes for sale you can select a list price that makes you stand out as the best choice for a buyer.
But this list price can’t account for a new home coming on the market at a lower price. If you list your home at $750,000, and the next day a better home comes on the market at $750,000,
the current buyers will automatically discount your price.
Now, I am NOT saying that your home won’t sell for $750,000 the very next day. I am saying that a buyer’s perception of value is fluid and those perceptions can change on a dime.
Urgency of the Buyer Population
The last factor I listed is the urgency of the buyer population in general. Interest rates, the economy and the availability of homes to buy all contribute to a sense of urgency or a tendency to “wait and see”.
Just like the stock market, urgency levels are very sensitive. Rates can tick up, or a news report about economic measure can kill the urgency in a market in a single day.
Let’s say you picked your list price last week when interest rates were at a high point for the year. This week interest rates dropped and the buyers are eager to lock before the rates go up again. BOOM- this changes the buyer’s urgency
Price is a Strategy
What does this mean?
Your home does not have a set price, it has a price range.
Therefore, your list price is not a statement of value, it is a strategy. With an understanding of the forces I described above, one can craft a strategy that will sell a home at the upper end of that range, or above.