When it comes to pricing your home to sell, should you go with above-, at-, or below-market pricing?

It's official - you've decided to list and sell your home!

Selling a home seems to be a healthy mix of excitement and pure chaos. First, we make the decision. Then, we price and list. Finally, we sell and move.

Plain and simple, right?

Don't we all wish!

Selling our home is exciting. The promise of beginning a new chapter of our lives in a new home is amazing. But before we begin that adventure, we need to price our homes to sell.

When thinking about whether we price our home using an above-, at-, or below-market pricing strategy, there are a number of things to consider.

Deciding on a price point when first listing a home can feel sort of like a game of roulette. Priced too high, there won't be any traffic to sell the home. Priced too low, and we may not get a return on our investment.

Check out this pricing guide to help you make your list decision.

The Price Is Right

Choosing a list price for any home requires a bit of homework and research.

Sellers need to take into consideration a number of different elements of their home's worth.

Is the home in a good neighborhood? Is that neighborhood gated?

Are there neighborhood amenities?

How are the surrounding schools rated?

What updates have been done to the home?

Those are just a few of the dozens of questions that potential buyers want answers to when considering a new home.

Every buyer has a laundry list of wants. Every seller has a laundry list of selling points. Making those two lists match comes down to setting a perfect price point for your home.

What is a Price Point?

When trying to settle on the perfect price for your home, sellers must set realistic goals with their asking price.

A price point is what you want to earn from the sale of your house, but includes what you will accept as a fair offer for your home.

There are times when a home will sell over it's asking price, but typically that is not the case for most home sales. A price point gives the high and low of what you expect to earn from the sale of your home.

For example, if you want to pocket no less than $300,000 for your home, then you may consider setting your asking price for $330,000. This gives you a price point with about $30,000 of wiggle room to ensure you pocket what you need from the sale.

Remember to do your homework, though. Setting an unrealistic price point can deter potential buyers. The best things to remember when setting a strong price point:

• Price competitively
• Use strategic pricing
• Know your local market prices

As soon as you have determined the price point for your home, you'll be ready to list. Based on the decided price for your home, you'll be able to list above, at, or below market value to sell your home as quickly as possible.

Do I Use Above-, At-, or Below-Market Pricing?

First things first, when deciding on which pricing strategy to use for your home, you need to think about the market.

Is it a buyer's market? Is it a seller's market?

Buyers Market

If you are in a buyer's market, then you may need to use at- or below-market pricing. A buyer's market means that there is a surplus of homes available for sale. This means supply is well over the demand for homes.

A buyer's market doesn't have to be a bad thing, though. People are always looking to buy a home. For the most part, every home sells.

If you need to move sooner than later, you may want to list your price below market value.

Of course, you don't want to list your home with a price point that is too low. For example, if comparable homes in your area are listing and selling for an average of $250,000, then listing for $248,500 could be just enough under market value to sell your home.

When buyers see a price that is a little less than the average home price in your area, it immediately looks like a good deal. This can increase traffic through your home.

Seller's Market

If you are in a seller's market, then your home may be a good fit to use above-market pricing.

A seller's market means that there are not enough homes to meet the demands of buyers. The demand for homes is higher than the supply of available homes for sale.

Take a look at the homes in your neighborhood and/or surrounding area. Are they selling faster than they can be listed on the MLS?

Strike while you can and list above-market value. You're in a hot market.

There may be times when your neighborhood and/or surrounding area may be in high demand, but there are quite a few comparable homes listed around you. Depending on how quickly you want to sell, this may be a good time to list your home at market value.

If a seller lists their home at market value in a buyer's market, they may be able to sell their home for over the asking price. Many times, listing a home at-market value can generate a lot of traffic through your home and lead to multiple offers on your house.

Using a strong pricing strategy for your home, regardless of whether you are in a buyer's or seller's market, is a great way to sell.

What Makes a High/Low Pricing Strategy Appealing to Sellers?

Using a high or low pricing strategy is marketing gold when it comes to advertising.

High Pricing Strategy

Let's say that your home is priced at $500,000. Comparable homes in your area are listed in this price point, as well, and they are selling in weeks, or even days.

If demand for similar homes is high, then try a high pricing strategy. List at, or even above market value. People obviously want to be in your neighborhood, so price your home a bit higher than the price of the last few homes that have sold.

But, don't be greedy.

Setting your price point $50,000 above what others are asking is an unrealistic strategy. If the average selling price of homes is about $500,000, then maybe push to $502,500.

Tour listed homes in your surrounding area. If your home offers more amenities, upgrades, or square footage, make sure to highlight those in your listing and during home tours.

Low Pricing Strategy

A low-pricing strategy can sometimes be the most fulfilling pricing strategy.

When you set your home at a price that is a bit lower than asking prices in your neighborhood or surrounding area, you can potentially create a bidding war.

If you are ready to move ASAP, then this type of strategy can be quite beneficial.

Setting your price a little below market value can have a positive impact on the sale of your home. Potential buyers will immediately be interested in a good deal, which may increase traffic through your home.

These types of pricing strategies are usually coined as being priced to sell.

What Does Priced to Sell Mean?

Sometimes, we find ourselves needing to sell our home quickly.

Taking a new job, finding a new home, or just wanting a change could make us want to sell our home sooner than later.

When we decide to move at the last minute, and we need to sell our homes ASAP, we use a priced to sell approach. This means we list our home for a price we know will be alluring to potential home buyers.

Using this type of strategy means that we price our homes equal to or lower than comparable home prices in our neighborhoods, or surrounding areas.

This type of pricing strategy can sometimes be confused with a home price reduction strategy. However, these two strategies are quite different.

What is a Home Price Reduction Strategy?

If our home has been on the market for longer than we'd like, we can use a home price reduction strategy.

When using this type of strategy, we drop our home price by a decent amount, to try and entice more buyer traffic.

If your home is not generating interest for many showings, or you're getting feedback that people think you are priced too high, then you may consider a price reduction strategy.

Moving On

After doing your real estate homework, it's time to price and list your home.

Make sure you know the prices, amenities, and options of other homes being sold around your neighborhood and surrounding areas. Also, make sure to get your home show-ready.

When potential buyers walk through your home, you want to make sure the wow factor is the first thing they notice.

Highlight features and updates that you have done to your home. Stage your home to make it feel move-in ready.

Then, decide whether you'll use an above-, at-, or below-market pricing strategy to sell your home.

All homes sell eventually. Using the right pricing strategy and highlighting the amazing aspects of your home will make the process a breeze.

Get excited about the next chapter of your life after you sell your home. Find a great real estate agent and reach out to get started!