AAccurately determining property value is the most critical task to getting your property sold. Factors influencing home value include location, condition, appraised value, the lender, and of course the marketplace.
Location, Location, Location
Condition of the Home
- Is the home ‘dated’ or ‘updated’? It is a sad reality that a state-of-the-art home today can be harshly criticized 10-15 years later. Homes have become like wardrobes; you do not have to update them but it will be noticed if you do not, and talked about negatively.
- Is the property well maintained? Except for investors who are eager to improve homes for large profits, most buyers want a home that has been loved and cared for. Deferred maintenance issues frequently kill deals during the inspection phase, or cost the seller money to fix problems before closing. Unfinished remodeling or overdue maintenance is expensive to a seller.
- Is the home attractively decorated and furnished? Proper staging is an art. Not staging a home will cost you showings, perhaps offers, and likely money during the negotiations. A well-presented house may net you more money, or it could just make the home more saleable, meaning it will sell quicker because it competes better against other properties. Appropriate condition correlates to the market expectations for the price range. You do not have to follow every home fashion or trend, but you should do what is expected for the price range.
So what should you do?
De-clutter. Less is always more. Pack up everything you can live without and store the boxes in the garage, shop, or a storage facility. Remove unnecessary furniture to open-up walkways creating a home that feels spacious and lighter.
De-personalize. The best showings are when buyers see less of you and YOUR home, and more of them and their new home. Galleries of personal pictures on walls or the refrigerator distract buyers. Create an opportunity for the buyer to mentally place themselves and their furniture in your home. Selling your home is not about you – it is about your buyers. You are not showing off your possessions or family, instead you want buyers to envision themselves in your home and to imagine what they could do with your home-canvass.
Appraised Value and Lenders
Professional technicians (appraisers) are hired by the bank to determine the value of your property. Your Realtor’s® job and primary goal is to understand the market and your property well enough to price your property so that it does not conflict with an appraisal. There is no worse feeling than being 3 weeks into a transaction and having the appraiser come in thousands of dollars under the agreed-upon price. Most buyers cannot, and will not, pay more than the appraised value. In this situation, the seller always feels violated and must drop the price. It is a bitter experience.
The Marketplace is the last court of appeals
Markets do change, sometimes suddenly. Bank-owned homes, short-sale properties, and discouraged and desperate sellers can cause prices to drop suddenly making your property appear over-priced. The ‘active comparables’ while not definitive for appraisals, must be closely watched because they are your competition. Sellers should know their competition and learn to think like buyers, not sellers! You do not need to be the lowest price on the market, but you must be the best value, or at least unique enough so that your particular kind of buyer will want your home even at a higher price.
Overwhelmed & Hopeless?
Buyers are savvy, and in this age of instant and vast information they will know your property and the competition well before they write an offer. Buyers will not be fooled. But the good news is that they also will recognize your good value. Their desire for good value and your desire to take the market seriously and offer a good value will eventually be a win-win deal. At that point both of you can move on with your lives.
Published on: Nov 30, 2012