Sometimes sellers want a number before anything else, and plenty of agents will give them one over the phone. Personally, I'd rather not, and I usually won't. I'll tell you what's sold nearby and how the market has been moving, but I don't like to recommend a list price until I've walked through your home and run a full analysis.
Pricing a listing is specific and technical, and much of what affects it doesn't show up in listing photos or public records.
Why the starting price matters
The goal is to price correctly from the first day on the market, when a listing gets the most attention. That's when you have the best chance of attracting multiple offers. Buyers compare your listing with everything else online in their price range. If yours is overpriced, they'll find homes offering more for the same money and won't schedule a showing. The buyers who do come through will often say the price is high, but the bigger problem is how few buyers come through at all.
I don't recommend underpricing either. It can work, but buyers use the list price as a starting point. A low price may bring several offers, but those offers may not go as high as they would have from the right starting price. I'd rather list at a price the market supports and let buyers compete from there.
What comps can't tell me
Pricing starts with comparable sales, and comps are mostly listing photos and data. I can see what a property sold for, how long it took, whether it sold over or under asking, and whatever the photographer chose to show.
Of all the properties I'm comparing, yours is the one I can actually walk through.
There have been many times I expected to price a home higher until I saw it. It wasn't as well maintained as I'd assumed, the layout didn't work, or the room sizes were awkward. Buyers notice those things within minutes, and they affect what buyers will pay.
It goes the other way too. Some homes show much better in person than in photos, and the condition or finishes support a higher price than I expected.
Why I don't give a number first
If I quote a price on the phone and the home doesn't support it, I have two choices: lower my number in front of you, or list at a price I don't believe in and let the market lower it for us.
Once a seller has heard a higher number, it's very hard to move them off it, and if they do come down on the price, they're disappointed. Because of this, I see the home first, then send a written analysis of what's sold, what's under contract, and what's currently for sale, along with my recommended price and how I arrived at it.
When another agent quotes higher
Some sellers will choose the agent who suggests the highest price, even when the comps don't support it. I still tell every seller what I believe their home will sell for.
I've lost a few listings this way in the last several years, and the outcome is usually the same.
Recently, I recommended a seller list her condo at $650,000. I was working on scheduling the photographer when she stopped returning my calls and then told me she was going with another agent. The condo listed at $700,000 and sat vacant for six months because she had transferred for work. Eventually, it sold for $650,000, exactly what I'd recommended.
It's in a very popular area of the city, and if it had been listed at the right price from the start, it would have drawn multiple offers and sold for more. Instead, she carried an empty condo for six months, only to sell it for the price I'd recommended in the first place.
I don't blame her! Of course, if another agent tells you that you can make $50,000 more, you're going to consider it. This is where experience comes into play. Sellers should ask to see the comparable sales and understand how the agent arrived at their recommended price before making a decision.
A couple of years ago, I met with another seller who wanted to list his home at $1.4 million. I recommended $1.2 million and didn't move from that. He listed with another agent at $1.4 million, stayed on the market for more than a year, and sold for less than $1.2 million. That's a year of mortgage payments, taxes, assessments, and utilities, plus a days-on-market count every new buyer can see.
When my own clients push
I'm not inflexible. If a client wants to list slightly above my recommendation and I don't think it will cost them much, I'll sometimes agree to it. Usually I hold my number. When I have let a client push the price higher, it has almost always backfired: the home sits, the price comes down, and I believe we could have sold it for more if we'd priced it correctly from the start.
If you're thinking about selling, the first step is a walkthrough. The price comes after that.
FAQ
How do Chicago real estate agents decide on a list price?
By comparing your home with recent sales, homes under contract, and active listings, then adjusting for condition, layout, and location. Those adjustments require seeing the home in person.
Can you give me a price estimate over the phone?
I can tell you what's sold nearby and how the market is moving. I prefer not to give a list price over the phone.
Should I list with the agent who suggests the highest price?
Ask that agent for the comparable sales that support it and a detailed explanation of how they arrived at the price. If the price is higher than what's actually selling near you, the market will usually bring it down, after your home has already sat.
Is it better to underprice my home to start a bidding war?
Not necessarily. A low price can bring multiple offers, but buyers use the list price as a starting point, so those offers may not go as high. I'd rather create competition at a price the market supports.
What happens if my home is overpriced?
Fewer buyers schedule showings, the home sits, and the price usually comes down. It often sells for less than it would have if it had been priced correctly from the start.
How accurate are online home value estimates?
They rely on public data and can't account for condition, layout, or updates. They're useful for a rough idea, not for setting a list price.
