How to Price Your Home

Today’s buyers are savvier than ever, so they’ll know whether or not your home is priced in line with similar homes they’ve seen. So getting the price right from the beginning is very important.  The trick is to find appropriate comparables.  To do that, just follow, these three easy steps.

  1. Start with your neighbors
    The apartments that are most similar to yours are those in your own apartment building.  If you live in a medium to large building there are likely to be similar sized apartments currently on the market or that have recently sold.  Ask your managing agent for the list of recent sales.  If some apartments seem to have sold for substantially higher or lower prices than similar apartments, ask for details.  Was one completely renovated with high-end appliances while another was a total wreck in need of major TLC?  How do the amenities and features of your apartment stack up against these apartments – views, outdoor space, layout, etc.?

    If others in your building have open houses, showing apartments the same size as yours, go check them out.  Take note of your reaction to seeing these apartments.  Even though they are the same size as yours, do they feel small and cramped or spacious and airy, comparatively?  This will help you understand how a buyer might perceive your apartment.  Depending on your reaction, you may be in a good position or you may need to think about de-cluttering or painting, or adjusting your price up or down accordingly.

  2. Go online
    The next best place to find comparables is online.  Search for similar homes in your neighborhood, starting here on ownersandbuyers.com.  Then search the websites of the major brokerage firms.  Also, the Real Estate Board of New York just launched a new website, www.residentialnyc.com that has the listings of over 50 brokerage firms, representing about half the apartments on the market.  A handful of the larger brokerage firms are not represented, so you will have to search their individual sites.  Where ever you search, make sure you are comparing apples to apples.  And if you have time, go look at some of your potential comps.  It’s the best way to understand your competition.

    • If you own a coop, do not include condos in your comps and vice versa
    • If you own a pre-war, do not include modern buildings in your comps and vice versa
    • Look at overall size, not just the number of bedrooms. A 900 sq. ft. 1-bdrm condo, is not a valid comp for a 650-sq.ft. 1-bdrm
    • Don’t forget to factor in amenities like fireplaces and outdoor space.  According to a “NY Times” article from July 2, 2006, outdoor space commands a big premium.

      Typically, apartments with private outdoor space get an extra 25 to 50 cents on the dollar per square foot, Mr. [Jonathan J.] Miller said. (So at $1,000 a square foot, the average price of all Manhattan apartments right now, a 400-square-foot terrace could add as much as $200,000 to the price tag.) …But there are limits. "We tend to see a diminishing return if the size of the outdoor space exceeds the indoor space," he said.

    Remember, that this represents an overall market view.  Not every terrace will command such a premium.  The article also notes that balconies, which are smaller and stick out from the building as opposed to terraces which are larger and sit on top of the building’s setbacks, command a much smaller premium.

  3. Factor in the difference in monthly maintenance costs.  If two apartments are virtually the same, except that one has a maintenance fee of $750 and the other $1,100, the latter apartment will need to be priced at a discount in order for a buyer to have a similar monthly carrying cost. Otherwise, a buyer considering both apartments would obviously choose the apartment with the lower maintenance.