The second major hurdle in selling your home is the price. The "feeling" of your home helps you get passed the Emotional hurdle in a Buyer's decision to purchase. The other major part of a decision is the Logical side. This is where the Buyer can justify his or her "feelings" for the home.

The Price of the home appeals to the Logical part of the Buyer.

So how do we determine price?

Most people start with the idea of value. You can determine your home's "Value" by seeing what other homes similar to yours have recently sold for. If you average out the selling prices and adjust for the differences in the homes, you reach its Current Market Value.

Current Market Value is generally easy to determine. We can now use this to determine a Smart Price.

In a seller's market, values are going up (because homes are selling for more and more.) So you can start with your Current Market Value as your Price and it will sell quickly (since there are more people wanting to buy than there are homes for sale.)

In a Buyer's Market, values are generally moving down because there are more homes on the market than people that want to buy. If you start your Price at your home's Current Market Value, you run into 2 problems. First, there are a lot of other homes on the market with the same idea. That means Buyers have a LOT of choices and yours won't stand out in the crowd. The second problem is that your home value will be slightly less in a few months than it is now. So you'll have to lower your price just to keep up with market value.

The longer your home remains for sale in a Buyer's Market, the more you'll have to reduce its price to keep up. And the longer your home stays on the market, the more likely you'll get very aggressive (low) offers from buyers. This becomes a vicious cycle that ends up costing you a lot of money in both the final sales price of the house as well as several extra monthly mortgage payments.

The smart way to price your home in a Buyer's Market is to price it just below Current Market Value. Your home will stand out as the "Deal" in the neighborhood and attract a lot more buyers. This can save you months on the market and thousands at the closing table.

So here's our formula for determining Price in a Buyer's Market:

Smart Price = Current Market Value - Small Adjustment