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How to set prices when selling property

Posted by Catherine Deshayes on Tuesday, June 09, 2009

The real estate market is subject to frequent fluctuations, more so when the economy is not doing too well as it is right now. In such a situation, if you're looking to sell a piece of property that you own, you need to ensure that the price does not go either too low so that you hardly break even, or too high that it scares away potential buyers from the scene...

There are various factors that go into setting the price of property, some of them being:

Location: This is probably the largest factor that decides the price of property. The closer it is to prime locations, the more its value. So take into account the asking rate of similar property in the neighborhood and then form an estimation of your selling price.

The condition of the property: For property to fetch a top-notch price, it must be maintained in a good condition. If your home or other asset does not have a run-down and neglected appearance, it's going to be easier to find a buyer who will pay more for it, since it means that they will not have to spend money in renovating and improving it.

Market conditions: No matter how good a property is, and how prime a location it is situated in, if the market is down, you cannot hike your asking price beyond a certain amount. If you do so, you may not be able to find any takers for your property, since others in your position will be offering similar property at lower prices.

The necessity to sell: If you are desperate to make a quick sale, you may be willing to settle for much less than your asking rate. On the other hand, if you don't mind waiting for the market to look up or for a buyer who is agreeable to your asking rate, then you may be able to hold out long enough without reducing the price. Setting a rate depends on how soon you need the proceeds of the sale and the purpose you need it for. An emergency may make you sell at any rate rather than hold on and struggle for much-needed money.

If you're able to sell your home without an agent and a lawyer, you would save on commission. But you must remember that things could go wrong without a go-between, so exercise this option carefully. 

Written by Kat Sanders, who regularly blogs on the topic of construction management degrees at her blog The Fixer-Upper Blog. She welcomes your comments and questions on katsanders25@gmail.com.

Picture by danzo08

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