To determine the asking price for a property, the real estate agent will research the comparable properties, or "comps".
Comps are recent property sales that are similar to the subject property. The comps are similar in size, location, condition, amenities, etc. Because the housing market is constantly changing, the real estate agent will generally find three comparable sales that have taken place within the past six months.
For example, assume that you wanted to sell your house for $350,000. Your real estate agent will first research the comparable properties that are similar to your house. Because every house is different, the agent might find a property that sold within the past six months for $330,000 and two others that sold for $340,000.
This does not necessarily mean that your house would be overpriced if you asked $350,000 for it. Is your house in better condition than the other three? Do you have custom audio throughout, fresh paint, a new roof, or any other improvements that would make your house stand out? Is the condition overall much better? Depending on the extras and improvements, your house could sell for $350,000. It is very important to look at the comps before deciding on the listing price for your property. They are an excellent guide and, after seeing all of the figures, you as the owner might decide to raise or lower the price of your house.
Thinking of selling? Contact us today!