Sellers: 7 Factors for Valuing Your Home
Sellers, one of the hardest parts of listing your home for the market is identifying, defining, and evaluating how much the property is worth. Properly pricing your home is not only essential but crucial to get it right.
Sellers make the mistake of thinking the price can always be corrected with the, “let’s just see!” Buyers have many options to find out what the actual value of your home is worth on their own, never mind when their agent starts pulling relevant data to prove what your home is worth. If sellers decide or agree to set the price too high you jeopardize having your home sit on the market for a month with no activity. As soon as your home hits the MLS, there should be plenty of activity.
Sellers should not take a “wait and see” approach!
Yes, each market is different, but agents should be reaching out to ask questions either for their own knowledge and to talk about the listing or for their buyers. If that is not happening, that is the markets way of telling the seller, you may be priced too high! If that is the case, your home will be ignored. And if you wait too long to correct the error, then you will forever be chasing the market and that shows poorly as well.
Determining a fair price for your home means looking at several factors and taking matters into consideration.
Everything is on the MLS and the internet, and buyers watch to see what is happening. Sellers, if you keep reducing and your home sits, buyers either walk away assuming something is wrong, or they come in with a low offer. Sellers, I know you worry about pricing your home too low, which may result in a quick sale, but you could also miss out on thousands of extra dollars in profit. In certain markets, pricing just below market value will sometimes create a bidding war, but that is something that cannot be guaranteed. This is where sellers need to talk openly with your agent to assess what is most important to you. Is time more important than top-dollar? Is top-dollar more important than a fast sale? The market must be evaluated to properly analyze what is going on, and pricing needs to be a key factor in deciding how to plan out your sale and timeframe for you to be able to move on. Sellers: Take notice!
Your Homes Condition
This sounds obvious. But, I have personally gone in, there is work that needs to be done, and the feedback is, “if I take care of it, I mine as well stay here!” “Let the buyers deal with it.” Or, “we can negotiate on it if it comes up.” That mindset is a problem and a barrier to a successful sale. Two things are going on with buyers. 1. They are willing to stay in place until they see what they want. 2. They will be offended, and then wonder what else is wrong with the property if you chose not to maintain the property while you have it under your supervision. Furthermore, they will wonder what problems exist that they can’t see. So, negotiating then turns into taking off so much money because they are worried about what they are going to find after the sale is over. Home maintenance is a very big issue today. It always has been, but there was a time when people were grossly overpaying for someone else’s headache, thinking money was going to come easily and freely to fix it after they moved in. Wrong! Not only do the buyers have to satisfy their own peace of mind, the inspector they hire, but the mortgage companies/banks, and the appraiser.
For sellers, one of the hardest aspects of listing their home is identifying their properties worth!
Buyers do not want to take care of someone else’s headache! The condition of your home has a large impact on the overall value. A home is an excellent condition will show better, stand out from the rest of the marketplace, and has a better chance of earning you a higher price than the homes you are competing with. And yes, this is a competition!
Repairs, minor upgrades, new roof, bathrooms & kitchens (if done in a neutral manner) will help to make your home more salable and will have a positive impact on appraisal and resale for your buyers. Is that important? Yes. When the appraisal comes back above the agreed upon sales price, that makes for a happy buyer and a happy buyer has less apprehension and a more positive outlook for their future wealth building potential in the home. That keeps the market healthy and moving.
Is Your Home Up to Code?
Overall, especially if you have an older home, the answer will mostly be no on certain issues. Not a deal breaker, but maybe items that will be a sticking point for negotiations. What I am really referencing is the DIY projects that should have had permits pulled, professional licensed contractors and that was never done. Again, it goes to number 1, the condition of your home. We all do things with the best of intentions and to try and save some money and time. But, if you removed a beam that you did not realize was in a loadbearing wall, and never bothered to take care of it because you have no idea what a loadbearing wall is, that is a huge issue. It really is best to find out from your local municipality what you need to do. First off, they are going to want to come in and inspect. Want to skip this part…, what happens if your potential new buyer wants it inspected by the City? They have the right to request that. You can say no, and they can back out. Then you must deal with your home being stigmatized for not making it through the inspection phase. Not only does it create a dilemma for you as the homeowner, but if something goes wrong, your insurance company will most likely not want to cover it, and your lien holder may also have an issue with you if you impacted the safety and structure of the asset they lent money on.
Buyers want the newest and the best! Why not? Homes are one of the largest ticket items we invest in. If your home is brimming with amenities buyers desire and require. This impacts how your home will be evaluated when pricing your home for the market. Some of the in-demand amenities include quartz countertops (less upkeep), stainless steel appliances and built-in appliances that look like they blend with the cabinets, wine refrigerators, steam showers, hot tubs, smart-home features, security, and extra storage. If you don’t have any of these in-demand amenities, then research and maybe offer them as an incentive to buy. Think like a builder that offers an upgraded appliance package, or security system, or an allowance for the new buyer to apply as they wish.
Size does matter!
The size of the lot is another aspect of your property to take into consideration because the buyers will. If your home is sitting on a lot that is larger than most, highlight that in your information that is shared with the public. Sharing the fact that you have a lot of acreage means a larger yard for buyers to enjoy, and that is sometimes overlooked but really would be appreciated if it was brought to their attention. And though it is stated in the MLS, it needs to be prominent in the writings of the information. Why? The buyers are looking as so much information now a day, it is easy to overlook something so important. Anything that makes your home stand out should be emphasized and reworded a couple of times to get the point across. And maybe you have a smaller lot, but it is fenced in and you have landscaped it in such a way that it is easy to maintain, water features, etc.…, adds value and appeal that outshines lots of acreage. Again, put a positive spin on it. Sometimes buyers say they want 5 acres, but what they really want is a nice amount of space to have outdoor living and privacy, and they realize they can enjoy a ½-acre lot far more than the 5-acre lot they thought they wanted. Perspective.
Relevant Comparable Sales
No two homes are alike unless they are built by the same builder with no changes! Very rare, especially if you have been living in your home, and you and your neighbor decide not to change a thing over the years. So, no two homes are identical, and therefore, when agents compare your home to another, no, we will not be able to find your exact home that has sold. But, we can find homes that are relevant. That have close to the same square footage, design, amenities, number of bedrooms and baths, etc.… And knowing and understanding what other homes that sold for in your area, is another essential must know. It is a wonderful way to accurately assess the value of your home by comparing the homes that sold to your home and what you have to offer. It is a small peek into what the market is doing in a specific period-of-time. Even after you have priced your home for sale, it is important to see what sells while you are on the market yourself. Why? The price of the newest sales will impact your overall value and appraisal. Not a problem if the prices are what you are asking for or higher. But an issue if the sales are lower. It is better to know what is going on in the market and understand how you are being affected by the other homes in your marketplace.
The Current State of Affairs
What is your market doing? Your agent will let you know. I like sharing this with potential buyers. When your agent does their brochure for your property, letting the buyers know that you are in the know and that you know and understand the marketplace gives them the understanding that you as a seller are knowledgeable and have data to back up your price, but are further showing them how you are relevant in the market and to take notice.
The state of the current market will have a significant impact on prices and give you the upper hand in understanding where you need to price your home, what amenities are sought after, what the average number of days on market is, and what the list-to-close price ratio is. The more knowledge you have, the better off you will be. Knowledge is power and applying the knowledge to leverage your largest asset is key to your long-term wealth growth, peace of mind, and not missing out on opportunities as they present themselves.
7. Your Agent
Yes, you want an agent that has experience or works with a team of agents that have experience. Yes, they need to be knowledgeable and find out what they need to know about pricing, marketing, representing, and negotiating on your property. But, you also have to feel comfortable with your agent. You will be working closely with them, and you need to have an open form of communication, you need to feel comfortable to go over all concerns, wants, needs, and expectations. You need to feel as though you are represented and understood. Really pay attention to how you feel after you talk with the agents you interview for the very important job of listing your home. Everything mentioned will help you feel comfortable through the process of selling your home, and help you speak up if you are not comfortable or confused by something. Your agent needs to know.
You be the judge.
I do not tell my potential clients “I am the best.” That is up to them to decide, and they will decide that after we have closed and the whole entire deal is wrapped up. 5oo people could think I am the best, and one may think, eh! Guess what, that eh, matters! And I can learn from them. Also, I make mistakes. I am human, and I tell my clients, how I work, what I do, and that I am far from perfect, and if you notice something, let me know. I want to correct it, I want to make certain I don’t make mistakes, but if I do, call me, text me, email me, tell me when I am at your home. I will make it right. We are an extension of you. We represent you, and we are here to serve you and help you sell your largest investment. It is a team effort, but you are the leader and you are in charge.
- 2018 Real Estate Market Forecast
- 7 Instant Curb Appeal Improvements.
- All News
- appeal to the majority
- Credit Scores
- First-Time Home Buyers
- Good Credit
- Home Shortage
- Homes for sale
- How much should I offer?
- Maine Real Estate
- Massachusetts Real Estate
- NH Real Estate
- NH Seacoast Homes For Sale
- Real Estate News
- Sellers Real Estate Information
- Selling your home
- The It Factor!
- The Market Reports
- The State of Affairs
- timeless livability
- Why do real estate agents exist?