Your House Is Not a Math Problem

Last mo I wrote about why you probably shouldn't use ChatGPT to sell your home. Or more accurately, why you probably shouldn't let it drive.

The response was interesting. Some people thought I was anti-AI. Others thought I wasn't hard enough on AI. A few Realtors texted me. My dad called me the next morning.

Not to discuss artificial intelligence.

To ask me what I had against Sawzalls.

Fair question.

The next logical place to go in this series is pricing. At Cool Murphy, a big part of our process revolves around what we call the three Ps: pricing, presentation, and promotion. They're all important, but pricing comes first because the other two can't save you if you get that part wrong.

And if we're being fair to ChatGPT, pricing is probably one of the places where AI has the most potential. There are billions of dollars being invested into home valuation technology right now. I've sat across conference tables from founders trying to solve this exact problem. I've taken Zoom calls. I've been paid for my opinion on these tools because people know my background in technology, media, and real estate and assume I might have something useful to say.

Some of the products are genuinely impressive. They're getting better quickly, and I suspect they'll continue getting better. But every time I leave one of those conversations, I find myself circling back to the same thought: housing is one of the messiest products on earth.

Not because the math is hard.

Because the people are. And because houses are.

Which brings me to a conversation I have almost every week.

A seller tells me they've already done some research and have a number in mind for what they'd like to get for their home. Before we ever sit down together, they've usually completed our Let's List questionnaire, and somewhere in that paperwork is a number. Sometimes it's ambitious. Sometimes it's conservative. Usually it's somewhere in the middle.

So I ask how they got there.

And eventually I hear some version of the same phrase.

"I comped it."

Great.

Walk me through it.

What I'm really asking isn't what number they landed on. I'm asking what information they trusted enough to build that number around. Because that's where things get interesting. That's where I find out whether we're talking about sold properties, active listings, a Zestimate, a neighbor's opinion, a conversation at a crawfish boil, ChatGPT, or a combination of all five.

And the truth is that most of those sources contain useful information.

The problem is that useful information and useful conclusions are not the same thing.

The Easiest Home In The World To Price

One of the first things I learned in real estate is that the easiest home in the world to price is the one that already sold.

Even then, you have to be careful.

I've seen the cash buyer who overpaid for a fixer-upper because they didn't know any better. I've seen the fixer-upper that sold too low because a succession was involved and certainty mattered more than squeezing every last dollar out of the sale. I've seen the house that showed one day on market and sold over asking, only to discover later that the buyer had already been identified before it ever hit MLS.

If you don't know the story behind the number, sometimes the number isn't telling you much at all.

The challenge is that most sellers don't start with sold homes. They start with active listings. That makes perfect sense because active listings are visible. They're easy to find. They're right there on Zillow waiting to be compared.

The problem is that active listings aren't evidence.

They're hypotheses.

That house listed at $750,000 isn't proof that your house is worth $750,000. It's proof that somebody hopes their house is worth $750,000. The market hasn't weighed in yet. Buyers haven't voted. We don't know whether it's brilliant pricing, reasonable pricing, optimistic pricing, or completely disconnected from reality.

Sometimes we don't know for months.

If I'm studying a neighborhood and I see eighteen listings, two recent sales, one pending property, and a pile of homes that expired, withdrew, switched agents, or quietly disappeared from the market, I'm not looking at eighteen success stories.

I'm looking at a handful of success stories and a lot of cautionary tales.

What's funny is that sellers almost never describe their goals in those terms. I've never had someone sit down across from me and say, "Elisa, I'd really like to maximize my sale price and spend the next eight months coordinating showings while strangers wander through my living room every weekend."

Even the sellers who tell me they have time don't really mean that.

What they mean is that they don't want to feel rushed. They want flexibility. They want confidence that they're making a good decision. They want to know they didn't leave money on the table.

Those are reasonable goals.

They're also different goals than wanting your house to sit on the market indefinitely while you wait for validation.

Why Zestimates Are Grossly Inaccurate

Let's talk about Zillow.

Years ago, Zillow became so confident in its ability to value homes that it decided to start buying them.

The theory was elegant.

Use data to estimate value. Purchase homes. Improve them. Resell them. Scale the process.

What happened next should make every seller feel a little better about being confused by home values.

Housing turned out to be exactly what housing has always been: one of the most emotional, inconsistent, locally influenced products on earth.

The effort resulted in enormous losses and thousands of layoffs.

If one of the largest housing-data companies in America struggled to accurately value homes at scale, perhaps we can all extend ourselves a little grace when we discover this isn't as simple as multiplying square footage by a neighborhood average.

And before the Zillow loyalists come for me, that's not an argument that the Zestimate is useless. It's an argument that the Zestimate has limitations. Every tool does.

The problem is that New Orleans is spectacularly bad at being averaged.

That's part of why we love it.

A tool designed around identifying patterns struggles when the thing you're measuring refuses to behave predictably. Two double shotguns next door to one another can have wildly different maintenance histories, wildly different renovations, wildly different floor plans, and wildly different buyer appeal.

One can feel ready.

One can feel exhausting.

The Zestimate doesn't know the difference.

Your House Is Not A Math Problem

One of the reasons pricing remains so difficult is that buyers don't experience houses the way data does.

They experience them as people.

I hear buyers tell me all the time that they need 1,800 square feet. They've researched it. They've discussed it. They've landed on the number.

Then we walk into a 1,500-square-foot historic home and suddenly none of us are talking about square footage anymore.

"This feels huge."

No.

It feels good.

The ceilings are higher. The layout makes sense. The storage works better. The house feels easier to live in.

The number didn't change.

The experience did.

And that's where pricing gets messy.

Zillow doesn't know the train blows its horn every morning. ChatGPT doesn't know the house next door has looked halfway abandoned for three years. Neither one knows that the property across the street just got beautifully renovated, or that the double next door has a tenant who likes to practice drums at midnight.

They don't know which block feels cared for.

They don't know which block feels forgotten.

They don't know that one side of the street somehow feels dramatically different than the other despite being separated by forty feet of asphalt.

And while I don't technically recommend tasting houses, some smells are strong enough that you practically can.

Buyers certainly can.

The point isn't that technology is bad at pricing homes.

The point is that homes are physical experiences. People react to them emotionally long before they start justifying those reactions logically.

They know how they feel before they know why they feel it.

That's true in relationships.

It's true in restaurants.

And it's definitely true in real estate.

The Real Reason Sellers Overprice

Most sellers aren't trying to be unreasonable.

They're trying to feel like they won.

That's a different thing.

When someone tells me they want to make money on their home, what they're usually describing isn't a net sheet. They're describing a feeling. They want to feel like buying the house was smart. They want to feel like maintaining it mattered. They want to feel like all those years of decisions, projects, repairs, upgrades, and sacrifices added up to something tangible.

And who can blame them?

Homes hold years of our lives.

The challenge is that buyers don't pay for your memories. They don't pay for your stress. They don't pay for the twenty Saturdays you spent at Home Depot. They don't pay for the argument you had over which countertop to choose or whether the bathroom renovation was worth it.

They pay for what's in front of them today.

One of the most common situations I encounter is a seller who purchased a beautifully renovated home fifteen years ago. At the time, the HVAC was new. The appliances were new. The water heater was new. The roof was newer. Everything felt fresh.

Now they're selling.

The market has appreciated.

So have the systems.

Just not in the direction anyone wants.

The home they're selling isn't the same home they bought.

And buyers know that.

Even when sellers don't want to.

Pricing Is Probability

The longer I do this job, the less pricing feels like arithmetic.

People desperately want it to be arithmetic. If it were arithmetic, we'd solve it. AI would solve it. Zillow would solve it. We'd all agree on the answer and move on with our lives.

Instead, pricing feels a lot more like probability.

You're trying to estimate who will buy the house, how quickly they'll buy it, what they'll compare it against, what compromises they'll tolerate, what alternatives they're considering, what financing they're using, and how exhausted they are by the entire process.

Because buyers are exhausted.

We've spent the last decade learning how to optimize everything. Our diets. Our workouts. Our travel. Our productivity. Our calendars. Our sleep.

Now we're trying to optimize housing.

The problem is that homes remain stubbornly human.

People still buy them because of instinct. Because of timing. Because of relief. Because of possibility. Because a spouse walked in and immediately said, "This feels right." Because somebody's dad in Colorado read the inspection report and had very strong opinions about a hundred-year-old rafter made from a ship's mast.

Data matters.

It matters a lot.

But data still requires judgment.

And judgment is where things get interesting.

So What Do You Do?

There is a number you believe your home is worth.

There is a number someone else is willing to pay for it.

The art of pricing is finding where those two numbers meet while leaving as little money on the table as possible and creating as little stress for you in the process.

That's harder than it sounds.

It's also why pricing remains one of the most valuable services a good Realtor provides.

Thinking you might be selling?

Take our Seller Readiness Quiz. It will help you figure out whether you're truly ready to move before you start worrying about what your home might be worth.

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Celebrated for her next-level creative approach to real estate, Elisa Cool Murphy is the author of Prepped to Sell: What Works Even When the Market Doesn't. She is an award-winning, top-performing real estate broker in New Orleans and the founder and owner of Cool Murphy Real Estate.

You can learn more about her here.

Contact Her -

email: cool@coolmurphy.com

Facebook: @homeinneworleans

IG: @coolmurphynola

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phone: 504-321-3194