How to Price a Home In 2025

Most agents guess the price. The great ones have a system.

In this episode of Growth Drivers, Mike and Rachael Novak break down the five core strategies for nailing your home pricing in 2025—without relying on gut feelings, Zestimates, or wishful thinking.

If you’re a real estate agent tired of seeing your listings sit, drop in price, or miss the mark entirely… this one’s a game-changer.

We’re sharing:

— The biggest pricing mistake agents make (and why 50% of listings end in price reductions)
 — How to actually use comps, actives, pendings, and solds without getting misled
 — Why waiting until the last minute to price a home can give you the upper hand
— The “perception of value” principle that instantly positions your listing to win
— How to bring your team into the process to ground seller expectations with confidence
— And the 3 traps to avoid: Zestimates, net goals, and price-per-square-foot fantasies

Whether you're listing your first home or your hundredth, these insights will sharpen your edge, help you price with precision, and turn more listings into closings.

Grab a notebook, hit play—and upgrade your pricing playbook.

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Transcript

Introduction to Home Pricing 

Mike Novak:
[0:33] How to price a home in 2025. This one is going to be talking to the real estate agents that follow us. Um, but also if you're just curious, like how to real estate and surprise houses, we're going to share some really tactical stuff with you. So on this podcast, you know, we try to touch on a bunch of different things, try to talk on, touch on growth and transformation mindset, the four domains, body being balanced business. And then of course, tactical real estate. And this one's we price these houses. And we're talking about this today because I've seen now for two years, a real struggle from agents on how to price homes in our market. Like maybe it's not the case everywhere, but locally it's kind of felt like people are like not really sure what to do. And that's evidenced when you look at price reductions, right? Exactly. Something like 50% of the listings get a price reduction, which is crazy, right? So that, that tells me people are missing the mark on price or there's a missed expectations conversation happening between the seller and the agent where they're not actually sharing the truth of the value. 

Rachael Novak:
[1:33] Right? 100%.

Mike Novak:
[1:33] So somewhere in there. So we wanted to give you guys like five ways to nail your price. This is going to be a pretty quick hitting podcast today, just going to get really down and dirty. If you want to take notes, definitely do it. But our goal is that at the end of this, you maybe have like one thing that you could add into your pricing formula, right? Like just one thing, one tool in a tool wallet that you can now pull out and just get that price a little bit more accurate. 

Rachael Novak:
[1:57] Yeah, I mean, because at the end of the day, you know, if you're using comps, obviously, like we all look at the comps, we all look at what's happened, we're going to look at what's happening, right? What's actively for sale, what's the current competition.

Understanding Market Dynamics

 
Rachael Novak:
[2:09] But it's there's more to it than that. There's more tools that you can do. There's more skills that you can lean on. So we wanted to share. And it's interesting, I was just having this conversation with one of our lender partners yesterday, just about how the market and it this might be everywhere right now, but the market is uncertain. And so a lot of buyers think that it's like open season, like, okay, we can ask for the moon and tons of closing costs. And then sellers are kind of like holding out for top dollar and think it's 2021 again. And so there's this big mismatch of expectations right now. So pricing a home is even more important and to be able to set those expectations with the sellers. key right now in getting the listing moving. 

Mike Novak:
[2:49] And here's the thing that I've experienced having done this a lot is that when you price it right, you can know that almost immediately when the listing goes live.

 
Rachael Novak:
[2:56] Yep. 

Mike Novak:
[2:56] Like you just know. 

Rachael Novak:
[2:57] You'll know within 48 hours.

 
Mike Novak:
[2:58] Right on that one, right?

 
Rachael Novak:
[2:58] Yes.

 
Mike Novak:
[2:59] Or if it's just crickets like, oh shit, I missed the, I missed this one. Right. And, and here's the thing is we all are going to get it wrong at some point. If you list hundreds and hundreds of houses, then you're going to get it wrong in some way, shape or form. But, but hopefully we give you a process that's going to get it right more often

 
Five Key Pricing Strategies

Mike Novak:
[3:12] than not. So number one is do thorough research. Okay. It should be like a pretty extensive process that you go through to analyze all of the comps for the listing you're possibly going to be getting. This is something you don't want to just like run through. This is not a race attention to detail and really taking the time to analyze the comps is going to be very, very important. And so we want to look at actives, like, which is of course, like what is the active competition in the market for to list this house today? That's kind of what you're saying. Like, where's the market at right now?

Rachael Novak:
[3:43] Yeah, that's going to be like the thermostat, right? The temperature gauge of what is happening in the market right now.

 
Mike Novak:
[3:49] Right. So definitely want to look at that. And when I'm looking at actives, I'm looking at, you know, how are these homes presented? What's the marketing look like? What's the presentation look like? What's the pricing look like? What's the days on market look like? And how close are these to the one that I'm going to be listing?

 
Rachael Novak:
[4:02] Yeah. Have there been price reductions? Have they been sitting? Have they been aggressively price reducing? You know, like there's a lot to look at.

 
Mike Novak:
[4:08] Yeah. And in a swift moving market, the actives really are going to hold a lot of weight in the pricing, right? Because people, you know, buyers shop by comparison, something we've talked about for years, right? So what else is out there? And with the, with the solds and pendings, those aren't actually competition. Those aren't comparisons, right? So it's really what else is out there when you're going to go live.

 
Rachael Novak:
[4:27] Well, exactly. I mean, as a listing agent, when you're listing a property, you are creating a perception of value, right? And so if you see all these homes and you're like, oh, well, I have a 200 square foot larger lot, so we're going to price it 20,000 above. Most people don't care about the actual size of the lot if it's that minuscule and your perception of value has just gone down because you seem overpriced compared to the competition.

 
Mike Novak:
[4:50] When you look at actives, I mean, do you try to diagnose why that home hasn't sold yet?

 
Rachael Novak:
[4:54] I'll sometimes ask the agent, like, hey, how many showings have you guys had? Have you gotten any feedback? I'm called a lot. I take a lot of phone calls from other agents asking me, why hasn't your house sold? And I always answer, because a buyer hasn't written an offer yet. That's why. Whereas if you call, like, first of all, don't call an agent and ask them why it hasn't sold yet. The question to ask when you call another agent with an active listing that could be a competition of one of your listings is, have you received any feedback as to why this house hasn't moved?

 
Mike Novak:
[5:25] There you go. Small, subtle language shift, but an important one. One puts, I think, the agent kind of on the defense, and one is just a curiosity.

 
Rachael Novak:
[5:33] Collaboration.

Mike Novak: 
[5:33] Yeah.

 
Rachael Novak:
[5:33] 100%.

 
Mike Novak:
[5:34] So that's actives. I mean, pendings are kind of where the market has been trending, but it's not at currently because it's already under contract. So on these ones, again, I'm looking at days on markets and multiple offers, whether they came in or not, going to definitely reach out to the listing agents if they're in the same community or even remotely similar to the listing that we've got going live. Anything else that you're looking for in pendings?

 
Rachael Novak:
[5:53] Yeah, I mean, just exactly what you said. So I'm calling every single house that's under contract, especially if it's past inspection. So if it's through like a contingency, you can see that it's truly pending and moving toward closing. It's an escrow. I'm going to ask, you know, how many showings did you guys have? Did you accept an offer at or below list? If they'll tell me, I'll ask like how far below list, were there any closing costs? Like I'll, I'll ask as many questions as I possibly can and gather as much information. Some agents stay very tight lipped. Some agents will share just kind of depends, but I never take offense either way.

 
Mike Novak:
[6:24] Awesome. And then solds, you know, I call this like the rear view mirror of where things have gone. Appraisers put a ton of weight into solds as agents. We put a little less weight in them, especially considering that appraisers go back like six months. And in six months, seasonality is a huge wild card to consider. Like right now, as we're making this podcast, it's April. And that means we're going to have comps from Thanksgiving and Christmas in there. Right. And we know that's a totally different market than something that came on the market just a couple of weeks ago. So I'm going to actually put less weight into the sold in a really dynamic market than I am into the actives and the pendings.

 
Rachael Novak:
[6:53] Right. Exactly.

 
Mike Novak:
[6:54] But getting feedback from the listing agent again, and your colleagues, like how did this listing go? Like, was there a lot of traffic? That's definitely helpful, right?

 
Rachael Novak:
[7:02] Exactly. 

Importance of Active Listings

Mike Novak:
[7:03] Anything else on solds? 

Rachael Novak:
[7:04] No, I think, you know, you're right in regards to seasonality. When I'm presenting it to my clients, because the clients, their natural tendency, a seller's natural tendency is to look at solds and be like, well, that now either justifies or hurts my value, right? And so if you're in a point where we're at like right now with we're being in April, you're looking back November, December, some of these houses, you have to kind of tell your client, we need to take this with a grain of salt, right this is this could be an indicator of what you could get or this could be a simple indicator of the seasonality of this past winter and we're in a different market right.

 
Mike Novak:
[7:38] Now right absolutely okay so number two wait to set the price until you're a few days out when we go to like this is what we train our team on what we do in our coaching company as well we will set price parameters at the listing appointment but we will not actually agree on the price right then and there, Why do we do that?

 
Rachael Novak: 
[7:55] Because it's a dynamic market. Like you can give a ballpark and I can say, you know, your house, from my opinion, in the current condition, or if they have some updates to do that I've given them a list for. If all of these updates are completed, we get it cleaned up the way that we're going to market the property. I'm going to estimate we're probably listed between 650 and 675. We're not going to pick that exact number until a day or two before we actually go on the market because I want the most up-to-date data possible. I want to know what actively is would be your competition. I want to know if any of the pendings, anything that's under contract has actually closed and can justify a higher price or might hurt our perception of value. All of these things are important to pick the price.

 
Mike Novak:
[8:31] Yeah. So we're going to basically do a full another market analysis about two days before your home goes live.

 
Rachael Novak:
[8:36] Right.

 
Mike Novak:
[8:36] And that's going to give us the benefit of seeing what has changed in the market, which, like you said, is very dynamic. It's also going to give us the benefit of seeing what you actually did to the house that we told you to do. Right. Exactly. Hey, we're going to give you a checklist of all those recommendations to do to your house. But did you actually complete them? And we can see if they're done or not. obviously we can see how the staging looks we can see how it photographs a lot of times i'm really surprised by our listing support team like you know i'll feel like one of my listings is kind of an ugly duckling and then i see it staged i'm like wow i mean this looks amazing and it actually will support a higher price than what i thought because once you move the people's
crap out of there and get it cleaned up and you put some staging in there wow it looks pretty inviting you know what i mean so it's. 

Rachael Novak:
[9:13] Like the you know setting the expectation with your client that you know how we live in a home when it's on the market feels like a movie set right like you're constantly. It's not how we actually live. It's not how anybody actually lives, but you are selling a lifestyle when you're selling real estate. And so it's really important that you're portraying that, right? It feels like it might be set.

 
Mike Novak:
[9:32] Yeah. And then one more just kind of component to point number two here, it will actually take the intensity and the expectations of that listing point down a big notch when we don't have to agree on the price right now. Like I've seen, like when I tell people that a lot of times like, oh, thank God. Like they're like so stressed out about getting the price and they thought we're going to have to have that conversation like good news we don't have to figure that out today i'm gonna give you a high i'm gonna give you a low kind of a floor and a ceiling and then we'll fine-tune that number once we are just about ready to go live and again it could be like two weeks between the list it could be three months you know like talking big big changes in the market.

 
Rachael Novak:
[10:06] And i've had the opposite happen where the person's like if you were to sell it right now what would you say what would it sell for and i was like well unfortunately i'm not going to be purchasing your property And market value is what a buyer is willing to pay for your property. So I can't tell you what your house is going to sell for. I can tell you that I would list it between this number and this 
number.

 
Mike Novak:
[10:24] Hmm. Interesting. I'd probably be like, well, given how much crap you've got in here and the condition I see, it's probably worth like 20% less than it's going to be when our team's done with it.

 
Rachael Novak:
[10:33] I like the strategy. A little reverse psychology. Like it. 

Mike Novak:
[10:39] All right. Number three, evaluating seasonality carefully. I talked about this a little bit when we were talking about the solds, but I know in our market, I mean, we experienced peak appreciation in April, May, typically, sometimes earlier than that. And then it like kind of tapers down the rest of the year. So you got to really keep that into consideration. There's no like bad time to list per se in our market, but you know, there's definitely slower periods of buyer activity, especially around the holidays. And if you look at the average sales price, it definitely goes down in Q4, right?

 
Evaluating Seasonality in Pricing

 
Rachael Novak:
[11:06] Right. Yeah, exactly.

Mike Novak:
[11:08] So how do you take that into consideration when you're trying to figure out price? Like how much weight does that carry? Are you just trying to find comps that closed in that same period? Cause you almost have to go back like a whole year to do that. Or how are you doing that? Just looking actives closer?

 
Rachael Novak:
[11:19] Yeah. I mean, you're really just watching the market in real time. So, you know, if I'm, for instance, I had a couple of friends that I was able to sell their home listed for the second time in a couple of years, but I was able to sell their home this, you know, past a couple of months ago. And originally they were really gung-ho about getting the house in the market as soon as possible. Okay. And one thing that I tell every single client of ours is if you are buying and selling in the same market. So if you're in Snohomish County, if you're in Nashville, if you're in Arizona, wherever the market that you're in, if you're buying and selling in the same market, it doesn't matter what time of year you buy and sell, right? Because all ships rise and fall with the tide. The market will come up and will go down. Whatever appreciation you experience on the sales side and get, you're going to end up paying on the buy side, right? Whereas these particular clients had already moved out of state. This had been an investment property. So they...

 
Rachael Novak:
[12:10] They were just selling this one. They weren't moving in the same market. So really getting the most amount of money was absolutely critical. So as much as they did not want to wait an extra month, I convinced them to say, hey, it's going to be worth the wait to hold the property, right? Because your holding costs are very low on this property. Your holding costs are maybe $3,000, maybe $3,200 a month with utilities. But if I'm able to make you even $10,000 more dollars or $20,000 more dollars by waiting a month, that's a good return on your investment. And so they did that. So what I tell people is we're looking in real time at this, but if you're selling and buying in the same market, it doesn't really matter when you do that. If you're selling in a market or just buying in a market.

 
Mike Novak:
[12:50] Then it matters.

 
Rachael Novak:
[12:51] Then it matters. And then you really want to be strategic with your seasonality, right?

 
Mike Novak:
[12:54] Yeah. We talk a lot of people out of selling over the holidays. We're like, let's just wait till the third week of January. Then you get a lot more.

 
Team Collaboration for Pricing

 
Rachael Novak:
[13:00] And they sure did. I mean, they got even above and beyond list price. It was amazing.

Mike Novak:
[13:04] Number four, lean on your team. So like we obviously have a team of really badass agents, like some of the top agents in the county. And so we will share our upcoming listings and try to get the price opinion from those agents as well. Just with their perspective, like, hey, here's the listing. Here's the comps. What do you guys think the price should be? And I don't usually tell them what 
my number is. I want to see what they come up with. And that's really powerful, right? Like we just did this on our own house. Like we just listed our own house and sold it. And our house was really hard to comp because it was a very unique property with like a big ADU and shop, a big Rambler on acreage. And it was just kind of a one, like a very unique property. And so we brought several of our real estate agent friends out, even agents that aren't on our team or in our brokerage, just some top producers looked at that we really respect that are good friends of ours. And we asked them for their price opinion. We got like five opinions from our friends.

 
Rachael Novak:
[13:52] And it was all over.

 
Mike Novak: 
[13:53] We were able to pick a number that we thought worked.

 
Rachael Novak:
[13:55] Yeah, exactly. And turns out we, put it on a contract in 16 days. 

Mike Novak:
[13:58] So there you go.

 
Rachael Novak:
[14:00] And this reminds me too. So like in my early, early real estate years, I worked at Windermere Real Estate up in Bellingham.

 
Mike Novak:
[14:07] 2005, 2006.

 
Rachael Novak:
[14:08] And they always did something like a caravan where they would all go tour after their team meetings on Tuesdays. They would spend two hours and go on a tour of all the brand new listings that each of the brokers had in the office. And that is when they provided feedback. So they had feedback forms. We like to do that before we go on the market. And so for the people that come in and I ask them to go through mine, I don't actually provide them any comps. I say, here's the details, here are the things that have been done, it's staged, here it is, and then ask them to do a quick CMA, walk through it, what's their perception of value, and kind of give me a ballpark number. What's most beneficial isn't getting that information for ourselves, although of course it is, but the most beneficial thing of enlisting friends, industry, you know, teammates, colleagues, that kind of thing, is to have that data for the client.

 
Mike Novak:
[14:55] Right?

Rachael Novak:
[14:56] Because now I have brought in other experts, other professionals who see houses every day, who tour 10 to 15 houses a week. Now they're, you know, giving some insight and it grounds the conversation with the seller and sets expectations very, very clearly.

 
Mike Novak:
[15:10] Yeah. I had that on a particular nice Everett view listing. You might remember this from last year. I'm not going to name any names, but he was thinking I was like 50 K low on the number and all of our agents went through their numbers were all 50 K lower than mine. And all of a sudden he was like, your number looks pretty good. And then I got on that number. Like, okay. I wasn't guessing, 

Avoiding Common Pricing Mistakes

 
Mike Novak:
[15:28] man. I put a lot of thought to that number, right? Yes, yeah, exactly. And then number five, don't test the market in most cases. Like when is the time to actually test the market?

 
Rachael Novak:
[15:37] I don't like to test the market ever.

 
Mike Novak:
[15:39] Well, if you have a unicorn property, like ours was, you can get away with it, right? Like, or it can be like really just kind of fuzzy on what that number could be. And that's when you might want to go on the higher end because you can't like ever go up from that number really, right?

 
Rachael Novak:
[15:53] Okay, so yeah, so to your point, So custom, really difficult to comp. Those are the properties you can test the market on because there is no basis for it, right? If you're listing a condo or if you're listing a home in a track housing community, testing the market is going to result in long days on market. Yeah, exactly. Yeah. So, okay, fair enough. The unicorn custom homes. 

Mike Novak:
[16:14] If it's in a cookie cutter neighborhood, if it's a builder home, like you definitely want to price it to exactly what the comps or what the actives would position you to sell for. So that's our five. I want to give people a couple of nuggets on ways that you should not price a home that they're going to hear from their clients on. The first one I want to talk about is pricing it off of the Zestimate. Why is that problematic?

 
Rachael Novak:
[16:34] Because the Zestimate is highly inaccurate all the time.

 
Mike Novak:
[16:37] I had no idea.

Rachael Novak:
[16:39] Yeah, no. The Zestimate, I mean, it takes almost nothing into consideration. It looks at trends, but it has no idea what's actually been done to the property. It has no idea. It's AI, right? It's just taking the data from other sales and throwing a number out there based on tax records and other sales in the community.

 
Mike Novak:
[16:57] Right. Okay. So probably not the best way to go.

 
Rachael Novak:
[16:59] Yeah.

 
Mike Novak:
[16:59] I do always look at the Zestimate and the Redfin number before I go to the listing appointment, because usually that's the number that's in the back of the mind of the seller. And I want to know if I need to litigate against that number or if I can actually go higher in that number. And sometimes it's like, honestly, 50-50.

 
Rachael Novak:
[17:14] No, it's such a great point. And especially recently, the Redfin numbers have been so high. Like all of the listing appointments that I have been on, especially the last month, I go in and the Redfin number, I'm like, this is like $40,000 or $50,000 more than I could even begin to justify. And so... Little pro tip for real estate agents and for people who are looking at these, please know that any automated estimate that you see online that is estimating higher likely has a division in that company that does cash offers. And so what they do is they will overestimate value in order to attract potential cash offer candidates. And then they will nickel and dime the absolute shit out of you and offer you 60, 70 cents on the dollar. So just another one, another little tidbit in regards to how not to price a property is a seller coming to you and saying, I absolutely need $200,000 out of this property. I can't sell it for anything less when they are desperate for cash. 

Mike Novak:
[18:17] You just stole my thunder. That was my next one. Yeah. The second way to not price a home is what I need to net and make off selling this house. No one gives a shit. The market does not care. you cannot outmaneuver the market, no matter how smart you are, right? The market will always determine how much your home is worth. They don't give a fuck what you need to make.

 
Rachael Novak:
[18:38] Nope, not at all. Exactly.

 
Mike Novak:
[18:39] Like, it just cracks me up when people say that. I need to make this. Well, no one cares but you.

 
Rachael Novak:
[18:44] Well, and I get it. Like, I would, and I sympathize. I'm like, I would love to sell your home for a million dollars. I get paid on a commission, a percent of a percent of a percent that you're going to pay my brokerage. Of course, I'd love to sell it for a million dollars. Unfortunately, I'm not buying it. And at the end of the day, another quick tidbit for real estate agents especially, is you don't actually control the price, right? I think these unicorn years, 2020, 2021, 2022, they really made people feel like they were really badass listing agents. Like they could sell a home for anything. Like it was their deal. 

Mike Novak:
[19:15] You talk about like the 17 offers, 100,000 over list price Facebook posts we saw for two years straight from everybody.

 
Rachael Novak:
[19:20] Like everybody thought they were a badass real estate agent. And let's be perfectly clear. Like I made those posts too. I once sold the house for $360,000 over list price. It was insanity in that market. Did that make me a phenomenal real estate agent? Maybe, but it more validated that the marketing that we do, the work that we do ahead of time, the staging, the suggestions that we do for the clients, the cosmetic updates that we do have a positive ROI, right? That's what it solidified. But at the end of the day, whether it's higher or whether it's lower is completely market dependent. The only thing that you guys control are the condition of the home, the showing availability of the home, and, of course, negotiating from a place of understanding, which we've done negotiation on this podcast before. those are the things that you can control. At the end of the day, you cannot sell a home for more than a buyer is willing to pay for it. Period.

 
Mike Novak:
[20:13] I like to use a little bit of psychology when people say stuff like, like I will use the same thing and say like, we're partners in this. Like I want to sell your house for as much money too, but I have a responsibility to be honest with you. And then they're like, Oh, damn it. 

Rachael Novak:
[20:25] Why? 

Mike Novak:
[20:25] Yeah.

 
Rachael Novak:
[20:26] Live in my fantasy. 

Mike Novak:
[20:27] I'm not going to lie to you. I'm not going to let you lie to you either. Right. Okay. The third way that you should not price of home price per square foot. Oh my God. I've argued with so many agents and clients on this one. Why is that not an acceptable method of determining value? 

Rachael Novak:
[20:41] Well, depending on the layout of the home, depending on the floor plan of the home, how everything about the home itself, like a home could be 1100 square feet and live like 2000 and a home could be 2000 square feet. And the way that it's laid out as a townhouse lives like 800. Like it really, at the end of the day has nothing to do with the square footage of the home. Like you can
ballpark it again, but, but really it has more to do with the perception of value of the lifestyle of that home. Right. Very difficult. 

Mike Novak:
[21:09] And also like when you get homes that are large, the price per square foot is going to be less. When you get homes that are small, the price per square foot can be much, much higher. Right. And then of course it doesn't even consider condition of the home. 

Rachael Novak:
[21:20] Right. 

Mike Novak:
[21:21] Right. It's just literally a mathematical formula. And, you know, appraisers like you can talk to them, they will tell you that's not even like a thought that goes through their head.

 
Rachael Novak:
[21:29] No, I think they track it, but they don't use it.

 
Mike Novak:
[21:31] Appraisers are looking at the subject property. Then they're looking at these comps. They're making adjustments to plus or minus to the subject property, right? And that's how they determine the value. So that's, I just like that one that always gets me. So we've heard all three of these multiple times.

 
Rachael Novak:
[21:44] Many, many times.

 
Mike Novak:
[21:45] So wanted to share those with you. So a little bonus. But that's what we got for you today. Super short, super tactical. Hopefully you can use some of these in your seller conversations. this spring to get more listings and actually sell them because none of us want listings that just sit there and turn those into more commissions. 

Rachael Novak:
[22:02] Absolutely. See you next time.

 
Mike Novak:
[22:03] See you next week.