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When selling your house, price
, condition and exposure
are usually the three most important
factors (aside from the familiar
“location, location, location” axiom).
A home is ultimately worth what someone
is willing to pay for it, not
necessarily what a seller wants for it.
Everything else beyond that is just an
estimate or opinion of value. Your
asking price is typically based on a
Comparative Market Analysis (CMA), and
may also be based on an appraisal, both
of which represent estimates of the
value of your house at a given time and
under specific circumstances, using
different but related information
sources.
As an optional step, you may elect to
have a certified appraiser perform an
appraisal. When estimating your home's
value, they take into account many
factors, including square footage,
construction type, style & quality, the
year the house was built, the design and
floor plan, the neighborhood,
availability of transportation, local
shopping, schools, lot size, topography,
view, landscaping, and any additions or
updates. Typically, an appraisal is only
valid for one year, so if it takes you
over a year to sell, you refinance
within a year, or if there are
significant changes to the property
(repairs, renovations, improvements,
updates, etc), you should obtain another
appraisal. Appraisal costs will
typically be a few hundred dollars,
involving many hours to research and
complete, but usually with just an hour
or two actually on the premises.
Josh Felker will perform a comparative
market analysis (CMA), usually when you
list your house with him. He obtains
current/recent data for several homes in
your area with comparable square
footage, land area & characteristics,
features and amenities. This correlates
your house to other very similar homes
that have sold in your area. This is a
free service as part of the listing
process, providing you with a frame of
reference with respect to properly
pricing your home.
It's important to note that an agent
for a buyer who may be interested in
your house would perform a similar CMA
for that buyer (most likely using the
very same MLS data), and based on its
results, would advise their buyer/client
as to (a) whether the property appears
to be overvalued, undervalued, or
appropriately priced, and (b) ranges of
values within which offers to purchase
might be reasonable, well-received and
successful, based on the buyer's own
needs and circumstances, on the buyer's
and their agent's interpretation of the
seller's situation, needs & motivation,
and on property status & condition.
When determining the listing price
for your property he can help you to view your
property as buyers (and their agents)
would. Regardless of property location,
condition or features, you'll want to
foster an overall impression in the
buyer's mind that your property
represents a “good value”. Overpricing
tends to discourage many buyers from
making any offer at all, because they
feel it would be a “waste of time” or
“insulting to the seller” to offer what
they think the property is really worth.
This could easily cost you a sale that
may have materialized if the buyer had
felt more inclined to “go for it”.
Conversely, under-pricing can invite
“low ball” offers, since buyers may
presume (a) that there may be
significant problems associated with the
property, such as major repairs needed,
infestation, contamination or
environmental concerns,
neighborhood/location issues, etc., or
(b) the seller is highly motivated,
possibly even “anxious” or “desperate”,
and vulnerable to any offer that “gets
them out”. But worse, under-pricing
leaves money on the table that should be
in your pocket!
The market is always changing, so
it's important that your asking price is
based on a recent appraisal and/or
comparative market analysis. He can help you price your
house so that (a) it will be attractive
to the broadest possible range of ready,
willing & able buyers, (b) it will bring
offers that closely reflect actual
market value, (c) it will be competitive
with other similar properties currently
on the market, and (d) it will yield the
best possible proceeds from the sale.
As a final note, if you are
evaluating more than one real estate
firm for listing your property, be aware
that you may receive some unexpectedly
high “estimates of value” and
corresponding “suggested list prices”
from overly zealous agents who either
(a) don't understand the market and its
dynamics, or worse, (b) want to “buy”
your listing by leading you to believe
that they can get a higher price for you
than the competition can. This latter
tactic is intended to get you to “sign
on the dotted line”, creating a binding
& irrevocable listing contract between
you and that agent's firm. Then, after
weeks or months of little or no
interest/activity, you are asked to
reduce the price to something closer to
the actual market value (where it should
have been priced in the first place).
However, this typically means that you
would have lost the “window of
opportunity” as a new listing on the
market; other agents would already have
disregarded your “overpriced” property,
and would not necessarily be inclined to
show it to their buyers. Unless you're
prepared to wait for the market to
“catch up” to your elevated price, don't
fall into the overpricing trap; while
you're waiting, your expenses and
mortgage payments continue, and the
price of your next house may be
escalating beyond your reach…
Correcting minor/cosmetic defects before
showing your house can help avoid losing
buyers who might be unduly influenced by
such details. In a buyer's market (when
inventory is high and/or buyer
competition is low), buyers feel free to
be more discriminating & selective, and
can be quickly “turned off” by things
that could have been easily corrected by
simple repairs. The better the condition
of your house in relation to your asking
price, the greater buyer interest and
appeal it will have, the faster it will
sell, and the more likely it will be
that it sells at or very near your
asking price.
Don't discount the potential impact
of “negative perceived condition”. While
a property that's immaculately clean,
meticulously maintained, tastefully
decorated and loaded with upgrades &
amenities certainly bolsters appeal and
perceived value, even the slightest
negative factors (dirt, stains,
offensive odors, leaks, broken items,
chipped/peeling paint, neglected
landscaping, etc) can significantly
influence a buyer's assessment of
acceptability and value, quickly
negating many of the “positives” your
property has to offer. Something as
minor as dirty windows or overgrown
foliage inhibiting the impact of a
spectacular view could subliminally
diminish an offer (if there is one) by
thousands of dollars, when a few cents
worth of window cleaner or a little
trimming effort could have
preserved/reinforced the perceived
value.
Once your house is correctly priced and
in its best presentable condition, it's
time to tell the world about it. You
might have the most beautiful home at
the best price in town, but if no one
knows about it, or if it's not marketed
effectively, neither price nor condition
will matter! Josh Felker
can broadly expose your home through
public open houses, broker open houses,
newspaper, radio & TV advertising,
promotion in area-specific real estate
publications, and by listing it in MLS
(multiple listing service). These
techniques (and much more), coupled with
many decades of collective local area
experience, are just part of the service
and benefit derived from having Josh as your own
personal professional Realtor ® .
A final word about “ Service Level
”… Remember that real estate firms
are businesses just like any other,
complete with expenses, cash flow, P&L,
license fees, insurance, and many other
familiar operating considerations.
Although ongoing costs such as
advertising, for example, take big bites
out of operating budgets, the sole
income source is sales commissions (with
a percentage to listing or selling
agents, and a percentage to “the
house”). Marketing, transaction
management, and client service can
consume significant resources (time and
money), and we strive to provide the
highest levels of professionalism and
client support & service in return for
commissions we earn. In short, you get
what you pay for, and Josh always delivers,
to meet your needs and exceed your
expectations!
There are, however, “discount”
brokerages out there, who purport to
provide “full service” with reduced
commission rates. Simple arithmetic and
basic business sense dictate that with
reduced income (but consistent costs)
per transaction, something must be
sacrificed. What typically suffers is
the overall service level, particularly
in critical aspects of marketing
(“exposure”)… a distinct disservice to
sellers and buyers alike. A few dollars
saved in commissions paid can be
severely overshadowed and offset by
missed sales opportunities, extended
market time, other ongoing seller
expenses, and diminished attention to
the negotiation process, likely
resulting in fewer dollars in the
seller's pocket when all is said and
done. As the old adage says, “Not all
that glitters is gold”…
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