How to Price Your Home to Sell: A Data-Driven Guide

Pricing is the single most important decision in your home sale. A correctly priced home generates showings in the first week, receives offers within two weeks, and sells at or above asking price. An overpriced home sits for months, gets price reductions, and ultimately sells for less than if it had been priced correctly from day one.

This isn't opinion — it's what the data shows consistently. Here's how to get the price right.

Why Pricing Matters More Than Anything Else

The relationship between list price and sale outcome is well-documented:

Homes priced within 5% of market value sell within 30 days roughly 60–70% of the time.
Homes priced 10% or more above market value sell within 30 days less than 10% of the time.
Homes that undergo price reductions sell for an average of 5–10% below the original list price and spend 2–3 times longer on market than correctly priced homes.

The reason is behavioral. When a home first hits the market, it gets maximum attention from active buyers. The first two weeks are the golden window. If buyers see your home is overpriced compared to [alternatives](/blog/heloc-alternatives), they don't make an offer — they just move on. By week four, your listing is stale. By week eight, buyers assume something is wrong.

How to Determine Your Home's Market Value

Step 1: Pull comparable sales (comps)

Comparable sales are the foundation of any pricing decision. You need to find homes similar to yours that have sold recently in your area.

Where to find comps:

Zillow, Redfin, and Realtor.com all show recently sold homes with prices, photos, and details.
Your county assessor's website has public records of all transactions.
A real estate agent can pull MLS data with the most detail (days on market, price changes, concessions).

What makes a good comp:

Location: Within 0.5–1 mile of your home, ideally in the same neighborhood or subdivision.
Recency: Sold within the last 90 days. In fast-moving markets, limit to 60 days. Comps older than 6 months are unreliable.
Size: Within 200 square feet of your home's living area.
Configuration: Similar bedroom/bathroom count.
Condition: Similar level of updates and maintenance.
Type: Same property type (single-family vs. condo vs. townhouse).

How many comps do you need? Three to five is the sweet spot. One comp can be an outlier. Five give you a reliable range.

Step 2: Adjust for differences

No two homes are identical, so you need to adjust your comp prices for differences between the comp and your home.

Common adjustments:

Feature	Approximate Adjustment
Bathroom (additional full bath)	+$10,000–$20,000
Bedroom (additional)	+$5,000–$15,000
Garage (1-car vs. 2-car)	+$5,000–$15,000
Updated kitchen	+$15,000–$30,000
Updated bathrooms	+$5,000–$15,000
Finished basement (per sq ft)	+$30–$60/sq ft
Pool (depends on market)	+$10,000–$50,000 or negative
Larger lot (per 1,000 sq ft above average)	+$2,000–$10,000
Superior location (backing to park, corner lot)	+$5,000–$20,000
Age/condition premium (renovated vs. original)	+$10,000–$40,000

These are rough ranges that vary by market. In a $200,000 neighborhood, a new kitchen might add $15,000. In a $600,000 neighborhood, it might add $30,000. Scale adjustments proportionally.

Example:

Your home: 3 bed/2 bath, 1,800 sq ft, original kitchen, no pool.

Comp sold for $420,000: 3 bed/2 bath, 1,750 sq ft, renovated kitchen, pool.

Adjustments:

Size difference (+50 sq ft × $150/sq ft): +$7,500
Your kitchen is original vs. renovated: −$20,000
Your home has no pool: −$15,000

Adjusted comp value for your home: $420,000 + $7,500 − $20,000 − $15,000 = $392,500

Do this for each comp. Your adjusted values will give you a range. Your price should be within that range.

Step 3: Check active competition

Comps tell you what homes have sold for. Active listings tell you what you're competing against right now.

Search for every home currently for sale within your price range and neighborhood. Note:

How does your home compare in size, condition, and features?
How long have those homes been on market?
Have any of them reduced their price?

If three comparable homes are active at $395,000–$405,000, listing at $430,000 means buyers will tour those homes first and probably make offers before ever seeing yours.

Step 4: Get objective data

Two ways to ground-truth your analysis:

Pre-listing appraisal ($300–$500). A licensed appraiser uses the same comp-based methodology but brings professional training and no emotional attachment. Particularly valuable if you're selling FSBO or if comps are sparse.

Agent CMAs (free). Interview 2–3 agents and ask each for a comparative market analysis. Compare their recommended prices. If all three say $395,000–$410,000 and you think your home is worth $450,000, the agents are probably right.

Pricing Strategies That Work

Strategy 1: Price at market value

List at the price your comp analysis supports. This is the safest strategy and works in any market condition.

Best for: Most sellers. You attract qualified buyers, generate competitive interest, and maximize your net proceeds.

Strategy 2: Price slightly below market value (1–3%)

Intentionally price just below your estimated market value to generate urgency and multiple offers.

Best for: Hot markets with low inventory. When supply is tight, underpricing by $5,000–$10,000 can trigger a bidding war that pushes the final price above where you would have listed. This strategy only works when buyer demand significantly exceeds supply.

Risk: In a balanced or cool market, you might just sell below market value without the bidding war.

Strategy 3: Price at a psychological threshold

Buyers search in price brackets. A home listed at $405,000 won't appear in searches filtered to "$350K–$400K." Pricing at $399,000 instead of $405,000 captures a larger search audience.

Common thresholds: $200K, $250K, $300K, $350K, $400K, $450K, $500K, $750K, $1M. If your value lands within $10,000 of a threshold, price just below it.

Strategy 4: Price for a specific buyer pool

In some markets, certain price points align with loan limits. In 2026, conforming loan limits are important — homes priced above the local conforming limit require jumbo loans, which have stricter qualification. Pricing just below that limit opens your home to more buyers with easier financing.

What NOT to Do When Pricing

Don't price based on what you need

Your mortgage balance, the cost of your next home, or how much you spent on renovations are irrelevant to buyers. The market determines value. A $50,000 kitchen remodel doesn't add $50,000 in value — it typically adds $25,000–$35,000.

Don't "test the market" with a high price

"We can always reduce later" is the most expensive strategy in real estate. Every day your home sits overpriced, it loses credibility. A price reduction after 30 days tells buyers you were wrong — and they'll wonder what else you're wrong about.

Don't price based on Zestimates or tax assessments alone

Zillow Zestimates have a median error of 6–7%. They're a starting point for research, not a pricing tool.
Tax assessments are calculated for property tax purposes and may not reflect current market value. In many areas, assessed values lag market values by years.

Don't price based on a single comp

One sale can be an outlier — maybe the buyer overpaid due to personal reasons, or the home sold below value due to a divorce or estate sale. Use 3–5 comps to establish a reliable range.

Don't add a premium for emotional value

"But we raised our kids here" doesn't increase market value. Buyers are paying for square footage, location, condition, and features — not your memories.

How to Know If Your Price Is Wrong

Your home is telling you if the price is wrong. Listen to it.

Signs your price is too high

Fewer than 10 showings in the first two weeks. In an active market, a correctly priced home should get 8–15 showings in weeks one and two.
Showings but no offers after three weeks. Buyers are comparing you to alternatives and choosing the alternatives.
Feedback from buyer's agents mentions price. If showing agents consistently say "nice home, but overpriced for the area," believe them.
You're the highest-priced active listing in your comp group. Check daily.
Online views are declining. Your MLS listing tracks views. If interest is dropping week over week, the market has moved past you.

Signs your price is too low

Multiple offers within the first 3 days.
Offers significantly above asking price.
Your agent is getting calls before the first open house.

If you're getting these signals, you likely underpriced — but in a multiple-offer situation, the market will correct upward through competitive bidding.

What to Do When Your Home Isn't Selling

Week 1–2: Wait

Give the market time to respond. Don't panic.

Week 3–4: Evaluate

Review showing feedback. Check online views. Compare your price to new comps and active competition. If all signs point to price, reduce.

Price reduction guidelines

Reduce by 3–5%. A 1% reduction ($4,000 on a $400,000 home) is too small to change buyer behavior. You need to drop into a new psychological bracket or meaningfully change the competitive picture.
Make one significant reduction, not multiple small ones. Multiple reductions signal desperation. One decisive move signals a motivated, rational seller.
Time it for maximum impact. Reduce on a Wednesday or Thursday to catch buyers planning weekend showings.

Week 6+: Reconsider everything

If your home still isn't selling after a significant price reduction:

Is there a condition issue you're overlooking? Ask your agent or a trusted friend for honest feedback.
Are your listing photos doing the home justice?
Is the home difficult to show (access issues, tenant occupied, pets)?
Consider taking the home off market for 2–4 weeks, making improvements, and relisting fresh.

How the 2024 NAR Settlement Affects Pricing

The 2024 NAR settlement changed how buyer agent commissions work. Previously, listing agents would set the buyer agent's commission and include it in the MLS listing. Now, buyer agent compensation is negotiated separately.

What this means for pricing:

If you choose not to offer a [buyer agent commission](/blog/realtor-commission-guide-2026), you might theoretically list at a lower price since you're not baking that cost in. But in practice, most buyers still use agents and will either need to pay their agent themselves or negotiate for you to pay it. Factor this into your pricing strategy — a lower list price with no buyer agent commission may not actually attract more buyers.

FAQs

How accurate is my Zillow Zestimate?

Within about 6–7% of the actual sale price for most homes, according to Zillow's own data. For a $400,000 home, that's a range of $372,000 to $428,000. Use it as a rough starting point, then do proper comp analysis.

Should I get an appraisal before listing?

If you're selling FSBO or if comparable sales are scarce, a pre-listing appraisal ($300–500) is worth the investment. It gives you a defensible price point. If you're using an agent, their CMA serves a similar function for free.

How much do renovations add to [home value](/blog/appraisal-process-explained)?

On average, most renovations return 50–80% of their cost in added home value. A $30,000 kitchen remodel might add $20,000–$24,000 in value. A $10,000 bathroom remodel might add $6,000–$8,000. The exceptions are high-ROI projects like garage door replacement (nearly 200% return) and [manufactured](/blog/heloc-on-manufactured-home) stone veneer (over 150% return).

Can I price high and just wait for the right buyer?

You can, but it rarely works. The "right buyer" is shopping your comp set, not searching $50,000 above it. Overpriced homes develop a stigma — the longer they sit, the less buyers trust them.

How often should I check my competitive position after listing?

Weekly for the first month. Check new listings, new sales, and price changes in your neighborhood. If the market shifts, your price needs to shift with it.

What if my neighbor's home sold for way more than mine is worth?

Dig into the details. Did they have a larger lot, a [renovation](/blog/bathroom-renovation-cost-guide), or a view you don't have? Was it a bidding war in a different market condition? One sale doesn't set your price — the pattern of multiple comparable sales does.

The Bottom Line

Pricing your home correctly requires research, honesty, and a willingness to follow the data instead of your gut. Pull comps, adjust them, check your competition, and land on a number that's defensible — not aspirational.

If you get it right, everything else in the selling process gets easier. If you get it wrong, no amount of staging, marketing, or negotiation can fully compensate. Start with the data, and let the market tell you what your home is worth.

Pricing Home To Sell

Key Takeaways