HOW TO PRICE YOUR HOME RIGHT
The single most important factor to consider when selling a house is pricing the house correctly. You don't want to overprice the house because you will lose the freshness of the home's appeal after the first two to three weeks of showings.
Pull Comparable Listings and Sales: Look at every similar home that was or is listed in the same neighborhood over the past three months. Appraisers do not use comps older than 3 months
Sold Comps: Compare original list price to final sales price to determine price reductions. Adjust pricing for lot size variances, configuration and amenities / upgrades.
Pending Sales: Make note of the days on market, which may have a direct bearing on how long it will take before you see an offer. Examine the history of these listings to determine price reductions.
Market Dependent Pricing Let’s use an example to demonstrate: Same house, three different prices.
Let's say the last three comparable sales in your neighborhood were $150,000. In a buyer's market, your sales price might allow some wiggle room for negotiation but be strong enough (near the last comparable sale) to entice a buyer to tour your home. To sell in this market, you might need to price your home at $149,900, settling for $145,000.
In a seller's market, you might want to add 10% more to the last comparable sale. When there is little inventory and many buyers, you can ask more than the last comparable sale and likely get it. So that $150,000 home might sell at $165,000 or more.
In a balanced or neutral market, you may want to initially set your price at the last comparable sale and then adjust for the market trend. For example, if the last sale closed three months ago, but the median price has edged upwards of 1% per month, pricing at $154,500 would make sense.
REFERENCE: The Balance