Price is the most challenging questions I get as a real estate agent. It also happens to be one of the biggest complaints about real estate agents today.
Sellers tend to be very unhappy with their agents when the offers received are much lower dollar amounts than the list price. If this happens to you, either you are not listening to your agent or the agent has failed to set expectations with you.
The last several years pricing has been all over the map. We compete with foreclosed properties. We struggle with fear in the market. We pull our hair out when an appraiser kills the deal becasue they value the home much less than it sells for. And we are amazed by lenders who change the rules daily, making it nearly impossible for buyers to get loans.
In my practice, I believe it’s about setting expectations of the market and process. I cannot control what a buyer does, they make an offer based on their needs and perception of value. So let’s talk expectations. First, What is my home worth? The simple truth, it’s worth only what some one will pay you for it. Sounds trite, I know, but it’s a fact and it’s something that we cannot predict. With that said, there is an approach that works well in most markets and that is being realistic and even pricing your home a bit below the available sold comparable data.
The realistic way to determine value is to look at homes that have settled that are similar to yours. You won’t find exact matches unless you live in a community where the size and floor plans are almost identical to your neighbors. Your agent’s job is to provide you with the data. We can show you what has sold in the general geographic area where your home is located. Then, together, we make adjustments to the value based on condition, size, style, age and updates that have been made to the property. There are no indicated numbers that we as agents use or appraisers use to make those adjustments. When I do these calculations, I base it on how much money is a finished basement worth, an additional bath or bedroom, a new kitchen and the like. Sometimes all the adjustment in the world doesn’t help your home sell quicker than your neighbors. An example would be, if your home has no basement and your neighbors does and theirs is finished as well. We can’t dig a basement under your home now and if a buyer must have a finished basement, they won’t buy your house even if it’s less expensive. Another example would be if a nearby home sold quicker than yours for the same or more money than you are asking. We ask why. Well the remarks say, new kitchen cabinets, granite counter tops, recessed lights and newly renovated bathrooms. Now you have a choice, you either make improvements or make adjustments. Some people won’t buy a house that needs a lot of work. Lets say the kitchen and bath updates cost $30,000.00 and you price your home $30,000 less then the competitor. It may not help, why would anyone want to do $30,000 in updates to get a $30,000 price reduction? There is no advantage except for possibly the color of the cabinets, granite etc.
Someone buying a home that needs work knows that hard cash to make improvemnts is harder to find than financing and paying more for a home that already has everything they want. So where does that leave you. In order to sell your home in a reasonable time you need to make adjustments realistically when comparing to other properties that settled. The settled price of sold homes tell us much more about realistic prining than the asking price of homes listed for sale. Those listed homes could be on the market for a year, do you want to sell your home? That is the question.
I can get you pretty close, it’s up to you if you want to take my advice. I will turn down a client who wants to list their home above other comparables. I don’t want to get fired for not selling it, I don’t want to have the price discussion every few days, I want what you want, a sold sign out front. Contact me about selling your home fast. I’ve had great success over the years and lot’s of experience when it comes to valuations. Last year I sold over 60 listings of mine and they brought fair prices.
Contact me anytime, by phone or email and let’s get your home sold fast for more.