One of the most important things to do when selling your house is to select the right price tag. If you price too high, interest will wane after the first couple weeks and Buyers get leery of homes that have had price reductions. If you under price, then you should get multiple offers to drive the price back up to market value. Because the market is constantly changing, house values constantly change. By looking objectively at the following data, create the best educated guess of market value and see if the Buyers agree.

• Pick reasonable comparables

• Consider sold, withdrawn, expired, and active listings

• Market conditions play heavily into pricing.

Ideally, the homes used as comparables to your own should be no more than 15% different in square footage, of similar age and lot size, and within half a mile or better from your house. You should also consider location as a determining factor for comparables: if the house is close to the main road, near the railroad, or abutting commercial property or an open area.

The market value is known for sold homes, so this is an excellent source to use when pricing your house. Be sure to note total days on market, including any listings for that house that may have expired or been withdrawn, and any price reductions. Make adjustments for significant differences in the properties being compared, including cooling type, lot size, type of parking, and so on.

Look to Expired and Withdrawn listings to get an idea of why a house did not sell. Was it overpriced? Was the condition sub-par for the area? Was it listed with someone who doesn't advertise? Look to these houses so that you don't repeat their mistakes.

Pricing your house by comparing to other homes still on the market is a bad idea, but a good way to understand your competition. Your home should look more appealing and better priced than the competition in order to sell quickly and for the best price. Preview competing homes on the market so that you see them firsthand, and can potentially make your house more appealing than those.

Price per square foot can be tricky; it's vital to compare apples to apples here. In a subdivision where the same builder was used and all houses are of similar age, amenities, and lot size, price per square foot can be an excellent indicator of value. However, if your house is in an area of older homes with different builders, with varying upgrades and improvements from house to house, price per square foot is not the most reliable indicator of value. Remember that price per square foot rises as the house gets smaller, and vice versa.

Market conditions play heavily into pricing. In a Buyer's market, your pricing must be strong enough to entice a Buyer, but should probably have a small amount of negotiating room. Pricing should be at, or even below that of recent sales. In a Seller's market, one can easily price their home over the last comparable sold, as values appreciate more rapidly with low inventory and an abundance of Buyers. In a balanced market, pricing should be set in line with recent sold homes, possibly allowing for a reasonable amount of appreciation if the most recent sold was a few months ago.