When you find a home that you fall in love with, you or your agent will have to perform a CMA. (comparative market analysis). There are many things to consider when pricing out a home and the guidelines below will give you a good idea on where to start.
When pricing out a home you want to look at the last 6 months of sold homes in the area. Try to stay within a 1/4 mile of the subject home. Looks for the same style home, same year built, similiar upgrades, similiar sq. footage, and similar lot size. If you are in a particuilair neighborhood or developement try to comp homes only in that area. You will want to look at the average days on the market and the list price compared to the sold price. If you have a low number for the days on the market and the sold to list price is the same or higher that's an indication that the neighborhood is very disrable. The oppsite is true with a high number of days on the market and sold price lower than the list price. Below is an example of how to price a home out.
The subject home is 2200 Sq. feet built in 1980 and has an updated kitchen and bath. The asking price is $300,000 or $136 per sq foot.
This home was in the same neighborhood built in 1979 and was 2000 Sq. feet but hasn't been updated. They were asking $230,000 and sold in the first week for $250,000 at $125 per sq. foot. The home had multipile offers so that shows it's in a disarable neighborhood. You would take the base price per sq. feet of $125 and multiply it by the subjects home sq. footage. $125 x 2200 sq. feet = $275,000. $275,000 is the basis for the subject home. Now you would add for the upgrades. The subject home has a new kitchen and bathroom or about $30,000 in upgrades. You would add this to the $275,000 and the subject home would be comped out at $305,000. Based on how quick this comp sold for and the subject homes asking price of $305,000 you would expect a lot of activey on the subject home and the subject home appears to be priced correctly based on the price per sq. foot.
There are a lot of other factors that come into play when pricing out a home. This should give you a good starting point when pricing a home out.