Bozeman’s real estate market went a little crazy over the last few years, and the median sale price of a home in Bozeman has more than doubled. If you are curious about how much your home is worth now, you are not the only one!
You may have high expectations of what price you could get for your home. And those expectations may very well be met if you put your home on the market. But, you might also be surprised to know that there are many homes on the market in Bozeman that are seeing price reductions, proving that it is important to price your home correctly.
In a market like Bozeman’s many sellers want to price high. But this isn’t always the best strategy. Pricing your home too high can cause it to spend more time on the market, which doesn’t reflect well on the property. if other homes are going under contract quickly. The other risk with pricing too high is that if the buyer is using financing to purchase the home it has to appraise for the agreed-upon price. If a home's appraisal value comes in below the price the home is under contract for, either the sellers have to reduce the price or the buyers have to come up with the difference. This is something we have seen happen often in Bozeman over the last 2 years.
Another strategy for sellers is pricing low in hopes of starting a bidding war. Escalation clauses and bidding wars became common in Bozeman’s real estate market over the last 2 years, so this is not unheard of. But there are a couple of problems that can arise if you go this route. The first is being inundated with offers and having to navigate through all of them. If you do choose that strategy, make sure you have a solid real estate agent who will manage the process well.
The other problem with this is that you may not get the bidding war that you expect. The real estate market is cooling and there is a chance that you only get one or two offers. This could be a tough pill to swallow if the price you listed your home for is much lower than the price you were hoping to get. We have seen this happen in Bozeman’s real estate market so it is something to keep in mind.
The accuracy of Zillow’s Zestimates is always up for debate, but even more so in Montana, Why? Montana is a non-disclosure state, which means no one has access to the sold prices of a home other than members of the MLS. When sold data is not available, online home valuation tools gather data like the listing price, square footage, and location to guess the value of your property. To get an accurate evaluation of what your home is worth, you need to ask someone who has access to the sold prices of homes in your area. You can use our free What is Your Home Worth tool to get started.
Looking at what homes like yours have recently sold for is a big piece of the pricing puzzle, but it’s not the only thing to consider. If you have done renovations or upgrades that add value to your home, those need to be taken into consideration when deciding on a price. Talk with an agent about any projects you’ve done to your home to see if they can boost your asking price.
An experienced real estate agent can provide you with a comparative market analysis that gives an accurate representation of what your property is worth. In our office, agents work collaboratively and often discuss pricing a home to get multiple opinions. In a market like Bozeman’s, this insight from other experts can really help zero in on the best price. An agent will also be the one to help you negotiate multiple offers, contingencies, and escalation clauses to make sure that you get the right buyers and the right price for your home.
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