When it comes to pricing your home, nothing's worse than second-guessing if you're too high or too low. That's where real estate comps, or "comparables," come into play. How you can use them to get the perfect home price? Why getting comps is crucial? How tools like "real estate comps calculators" or even "real estate comps free" resources can help make this easier? Just keep reading…
When it comes to setting a price, real estate comps are your best friend
Getting the right price for your home is about balance. Set it too high, and buyers may not even consider viewing it. Set it too low, and you might end up losing out.
Comps are basically an analysis of homes similar to yours that have recently sold, giving you an idea of what the market's willing to pay.
Comps work as a reference point, showing you how homes with similar features are priced, which keeps you competitive.
Benefits?
They allow you to:
Understand your neighborhood's pricing trends without investing money upfront.
Compare a wide range of properties at your leisure.
Learn what buyers are willing to pay in the current market climate.
What do good real estate comps look like?
To get useful comps, you want similar homes in size, location, age, and condition. It's like comparing apples to... apples. A good comp is a house with nearly the same square footage, similar lot size, and comparable updates or upgrades.
Usually, you want these homes to be within a mile or two of your property and to have sold in the last 5-6 months.
Also, using a real estate comps calculator can make this process so much smoother. Calculators or estimators do the legwork by pulling data from recent sales and displaying average prices, trends, and outliers for home similar to yours!
Here's a quick rundown of how to get started:
Online real estate platforms – If you're new to this, locqube is an excellent place to start before committing to paid services. You can add your address and you'll find out your home value estimator by comparing it to similar properties near your home.
County tax assessor's website – Many(not all) tax assessor websites have property sales data available. This can be a bit harder to navigate, and probably not always reliable., but it's free
Public records – Some counties and cities have public records with property sale information. It may require some searching, but it's a solid, no-cost option.
Factors that influence comps: The nuances to keep in mind
Real estate comps aren't as straightforward as checking prices. Many factors can impact a comp, and knowing these can help you better understand the numbers you see.
Here are some key elements that can affect comps:
Location differences – Even within a neighborhood, certain streets or blocks can be more desirable, which impacts pricing. For instance, proximity to schools, parks, or shopping areas can make a difference.
Home condition and age – A well-maintained home usually commands a higher price than one in need of repairs... even if they're the same size and location. Similarly, newer homes (you guessed it) often sell for more.
Upgrades and features – Homes with upgraded kitchens, finished basements, or large yards may have a higher price tag than similar homes without these features.
Market conditions – In a seller's market, homes tend to sell faster and at higher prices. On the flip side, in a buyer's market, prices may dip as supply outpaces demand.
Adjusting your home price with real estate comps
Once you've gathered your comps, it's time to interpret them and adjust your price. This part involves a bit of strategy. Here's a simple guide:
Start with the average price – Look at the average price of the homes in your comps list. This gives you a baseline. As mentioned before...in a seller's market, you might be able to set your price slightly higher as demand outpaces supply. However, in a buyer's market, pricing aggressively could help you attract more offers. In 2024, despite prices decelerating, they still remain out of reach for many would-be buyers. Look at the comps, but also consider your local market conditions.
Adjust for features – If your home has additional features or upgrades, consider pricing slightly above the average. Be careful, though—too much of a markup can push your property out of the competitive range. If it's missing certain desirable features, adjust accordingly.
Factor in market trends – Look at whether home prices in your area are trending up or down and adjust accordingly. Sometimes, despite your best efforts, your home might not attract buyers at the listed price. Don't be afraid to adjust your price based on feedback from potential buyers or your real estate agent. Remember, getting the right offer is ultimately about finding the balance between what you're hoping for and what the market is willing to pay.
Final thoughts
With free real estate comps calculators and value estimators at your fingertips, the pricing process becomes straightforward. Just a little digging into local sales and recent listings can unlock your home's ideal price. When you're armed with the right info, you can confidently say, "This is what my home's worth" – and be ready to back it up with the data that buyers respect.
